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6 Jan 2015
Fed unlikely to raise rates before 2015 end, USD might see pullbacks – Rabobank
FXStreet (Barcelona) - Jane Foley, Senior Currency Strategist at Rabobank sees less probability of a Fed rate hike before the end of 2015, and hence expects USD to see pullbacks if markets push their forecasts for a Fed hike.
Key Quotes
“Since the middle of last year the strengthened tone of the USD has been centred on the view that the Fed will be hiking rates in the middle of this year. However, US inflationary pressures remain moderate. Despite the improved growth outlook in the US, soft food and energy prices in addition to the stronger USD suggest there are downside risks to inflation.”
“In our view, the Fed is unlikely to hike interest rates before the end of 2015. If the market pushes back its forecasts for Fed interest rate policy, there is scope for USD pullbacks which would be reflected in EUR/USD and GBP/USD.”
Key Quotes
“Since the middle of last year the strengthened tone of the USD has been centred on the view that the Fed will be hiking rates in the middle of this year. However, US inflationary pressures remain moderate. Despite the improved growth outlook in the US, soft food and energy prices in addition to the stronger USD suggest there are downside risks to inflation.”
“In our view, the Fed is unlikely to hike interest rates before the end of 2015. If the market pushes back its forecasts for Fed interest rate policy, there is scope for USD pullbacks which would be reflected in EUR/USD and GBP/USD.”