BTMU: what to expect from the Fed?

According to analysts at Bank of Tokyo-Mitsubishi (BTMU), the “considerable time” phrase will likely be removed from the FOMC statement today. The Fed’s Chair Yellen will emphasize the “data dependent” nature of monetary policy decisions ahead, analysts expect. The Fed is also expected to acknowledge the fact that the labor market has strengthened more than expected.

However, the biggest source of potential market volatility will likely come from comments on international financial market conditions. "If markets sense increased Fed concerns over financial market conditions, the rate increase timing could be pushed back. As a result, upward pressure on the US dollar would ease.”

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