US Dollar reacts to Fed’s decision on inflation and rate cuts

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Key Takeaways:

  • 🔻 Dollar fell after Fed signaled leaning towards rate cuts
  • 📉 Fed wants confidence that inflation will fall before cutting rates
  • 📊 Fed unlikely to hike next
  • 📈 Consumer price inflation in March higher than expected
  • 💵 Fed announced tapering balance sheet shrinkage
  • 📆 Friday’s jobs report expected to show job growth
  • 💶 Euro gained, pound strengthened, dollar fell against yen
  • 🇯🇵 Japanese currency intervened to prevent further yen weakness
  • 💱 Dollar/yen will not stop climbing until U.S. economy cools off
  • 📉 Bitcoin fell to lowest since Feb. 27
  • 💲 The dollar dipped after the US Federal Reserve hinted at potential reductions in borrowing costs.
  • 📉 Traders adjusted expectations on the timing of US central bank interest rate cuts due to higher-than-expected consumer price inflation in March.
  • 🏦 Fed fund futures traders now anticipate 35 basis points of easing this year.
  • 💵 The dollar index fell 0.44 per cent, with the Fed also announcing a change in balance sheet reduction pace.
  • 📊 The next major economic indicator will be Friday’s jobs report for April.
  • 🇪🇺 The euro gained 0.5 per cent to US$1.0718, while the pound and the dollar also saw changes in value.
  • 📉 The Japanese currency rallied sharply due to yen-buying intervention by Japanese authorities.
  • 💰 Dollar dipped after the Fed mentioned disappointing inflation
  • 📊 Inflation expectations have shifted lower
  • 🏦 Fed officials are closely monitoring economic developments
  • 🌍 Global economic recovery remains uncertain amid the pandemic.
  • 💡 U.S. stocks initially wavered but rose after the Fed left interest rates unchanged
  • 📈 Analysts expect a 6.6% year-on-year earnings growth for the S&P 500
  • 💸 Amazon.com rose 4.5% with better-than-expected quarterly results
  • 📉 Starbucks tumbled 17.2% after cutting its sales forecast
  • 📊 Dow Jones Industrial Average rose 438.28 points, S&P 500 gained 40.06 points, and Nasdaq Composite added 177.25 points
  • 📈 Communication services sector saw the largest percentage gain in the S&P 500
  • 📉 Energy stocks were the laggards in the market.

Fed Signals Potential Rate Cuts and Dollar Weakens

  • 🔻 Dollar fell after Fed signaled leaning towards rate cuts
  • 📉 Fed wants confidence that inflation will fall before cutting rates
  • 💵 Fed announced tapering balance sheet shrinkage
  • 💲 The dollar dipped after the US Federal Reserve hinted at potential reductions in borrowing costs.

Market Reactions and Forecast:

  • 📉 Traders adjusted expectations on the timing of US central bank interest rate cuts due to higher-than-expected consumer price inflation in March.
  • 📊 Fed fund futures traders now anticipate 35 basis points of easing this year.
  • 💡 U.S. stocks initially wavered but rose after the Fed left interest rates unchanged
  • 📈 Analysts expect a 6.6% year-on-year earnings growth for the S&P 500
  • 💸 Amazon.com rose 4.5% with better-than-expected quarterly results
  • 📉 Starbucks tumbled 17.2% after cutting its sales forecast
  • 📊 Dow Jones Industrial Average rose 438.28 points, S&P 500 gained 40.06 points, and Nasdaq Composite added 177.25 points
  • 📈 Communication services sector saw the largest percentage gain in the S&P 500
  • 📉 Energy stocks were the laggards in the market.

Currency Trends and Global Economic Uncertainty:

  • 💶 Euro gained, pound strengthened, dollar fell against yen
  • 🇯🇵 Japanese currency intervened to prevent further yen weakness
  • 💱 Dollar/yen will not stop climbing until U.S. economy cools off
  • 🇪🇺 The euro gained 0.5 per cent to US$1.0718, while the pound and the dollar also saw changes in value
  • 📉 The Japanese currency rallied sharply due to yen-buying intervention by Japanese authorities
  • 📉 Bitcoin fell to lowest since Feb. 27
  • 📊 Inflation expectations have shifted lower
  • 🌍 Global economic recovery remains uncertain amid the pandemic.

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