Thursday, December 18, 2014

FOMC changes “considerable period” to “be patient,” lowers Fed funds forecasts

     FOMC changes “considerable period” to “be patient,” lowers Fed funds forecasts
    Yellen clarifies that this means not before April = earlier than expected
    Dot plot rate forecasts are 11 bps lower than before, but more focused = FOMC is becoming more united on the view
    Fed funds rate expectations move up, USD strengthens vs most G10 currencies
     Oil prices rebound, RUB recovers
    No clear trigger for rebound in oil, market just thinks it’s oversold
    RUB rebounds as central bank intervenes, adjusts bank accounting regulations
    I am still bearish on both, but we could see further mean reversion
     Greek president gets only 160 votes, far short of 180 necessary
    Looks like Greece might be facing a general election next January – that could be a major risk factor for the euro
     Today:
    Eurozone: German Ifo survey could surprise on upside, boost EUR
    UK:  retail sales ex gasoline expected to have slowed

    US: Phili Fed survey, Mariket service-sector & composite PMI, initial jobless claims, Conference Board leading index

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