Fed chair Powell keeps his cards close to his chest

Published date: 19/06/2019
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There was little else the Fed chair could add to the statement in the press conference today, with many of the questions leveled at him referred back to the communique which continues to focus on the incoming data.  As is now acknowledged, the Fed is wary of growing downside risks, not least of all due to to the trade wars, but his commentary was very sparse - perhaps not wishing to cause any ructions with the White House.  

Indeed, one of the questions put to him was whether he felt any undue pressure from the president, but the Fed chair politely steered the topic away from making any comments on publicly elected figures.  No doubt we will hear from the president through Twitter over coming hours or days, but the stock markets have taken well to this evening's events, with the markets now fully pricing in a 25bp rate cut next month.  

In the meantime, the USD has seen some modest softening, with EUR/USD holding a narrow range inside 1.1200-50, while USD/JPY is resisting moves under 108.00 while equities continue to stabilise around pre-announcement levels.  

Cable is sticking close to the mid 1.2600's for now, and USD/CAD is still teasing sub 1.3300 levels, so we will now have to wait until we get a full reaction from Asian and European sessions ahead.


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