There are growing gaps between the Fed’s outlook and market expectations. A sustained decline in inflation will justify only temporary reversals in EUR/USDreport economists commerzbank.
Dollar trapped between the market and the Fed
“The Fed has signaled that it is likely to adjust its rate outlook (point projection) higher at next week’s meeting and seemed eager to overturn market expectations of rate cuts next year.”
“However, the discrepancy between the Fed’s expectations and those of the market could widen further, which also translates into the possibility of a temporary recovery of the dollar if new data caused the market to align more with the outlook of the Fed. fed.”
“As we assume that inflation will now decline significantly and sustainably, this is likely to justify only temporary pullbacks in EUR/USD.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
