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Market Recap – BOJ, SNB and BOE monetary meetings

Thursday, September 19, 2019 11:09 AM GMT

Two out ten FOMC members favored a no rate cut decision. The majority of the FOMC proceeded with a 25bps rate cut, proving yesterday’s recap arguments wrong and at the same time revealing that we are living through a time of difficult judgement and different perspectives. The interest on excess reserves has been revised downwards by 30bps. The FED dots are pointing to no additional rate cut for 2019 and 2020, but the wording of Jerome Powell changed from the July’s “mid-cycle adjustment / insurance cut” to yesterday’s “we could follow the rate cut path, if appropriate”. FED is communicating that its decisions are data-dependent, but as Timareos from WSJ pointed out, there needs to be a degree of data independency when your duty is to perform risk management.

The BOJ (Central Bank of Japan) kept its monetary policy unchanged but is signaling that additional measures could be taken on the next meeting on the 31st of October.

Later today, it is the BOE (Bank of England) turn to announce its monetary policy. The taste from the previous meeting, on the 1st of August, was that Brexit is problem beyond the Central Bank’s capacity to anticipate, prevent or fix. In the meantime, President Macron and the EU’s President Antti Rinne, pushed Boris Johnson to come up with a proposal in writing by the end of September.

Today, marks the restart of negotiations between the USA and China as deputies from the two countries meet in Washigton DC to prepare the October’s face-to-face meetings between Liu He, Lighhizer and Mnuchin.

Macro releases: Other than the monetary meetings of the central bank of Japan, Switzerland and UK no significant macro releases are scheduled for today. Full economic calendar is here.

Disclaimer

The views expressed do not constitute investment or any other advice /recommendation /suggestion and are subject to change. Reliance upon information in this material is at the sole discretion of the reader. Opinions expressed in the report do not represent the opinion of ZuluTrade Social Trading Platform and do not constitute an offer or invitation to anyone to invest or trade.

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