Federal Reserve

FOMC 29th April 2015: Is the US heading back towards 2013 woes?

Most recently the US was reporting positive numbers across the range and a large part of the conversation was around interest rate hikes and  a higher interest in the USD Bond market.

The FOMC meeting has changed the spectrum of the ongoing conversation with no talk preluding to an interest rate hike or relative timeframe. GDP for Q1 2015 came in at .2% instead of the expected 1%.

All majors are winning significantly against the USD.

The AUD for instance is up nearly 300 pips since the 23rd of April and this is partially due to the iron and other resources doing well in demand currently.

The GBP has gained over 400 pips since the 23rd of April which is heavily influenced by the positive results in the Nationwide House Price Index.

The EUR has gained over 400 pips also based on the US spiralling towards negative growth.

We are currently re-evaluating our current holding as the home stretch for the remainder of the year for USD is heading away from the predicted positive outlook towards a rate hike and the Reserve Bank of Australia changing the tone from a  rate cut to a hold given the AUD performance the employment growth. The VIX is high and we recommend trader to prepare for Mayday or May Madness.

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