Markets await the Federal Reserve’s latest decision, expected to leave rates unchanged and provide some nervous commentary. Chairman Powell is likely to comment on the unsettled state of markets, due to the rising global tariff war, created by the Trump administration. The Fed is more likely concerned with the growing rift between the administration and the Central Bank. Trump has indicated he wants much lower interest rates globally, to stimulate markets, and provide solace for borrowers. The Fed and other Western Central Banks have decided to ignore this advice. There will be consequences, as trading partners are currently coming to understand. The US Dollar posted some gains ahead of the FOMC decision, with the EUR falling back to 1.0850, while the GBP fell back below 1.3000.The Bank of Japan left rates unchanged, confident inflation has been tamed and enjoying some positive trading data. The rise in the reserve hit the commodity currencies, with the AUD falling back towards 0.6300, while the NZD holds above 0.5750. The NZ markets await the latest Q4 GDP number, expected to confirm slight growth in the economy and a move out of the technical recession. The mass immigration is the only reason for positive GDP growth and the move out of recession, as growth/capita confirms an extended and deep recession. All eyes are on the Fed.
