TD is anticipating that the Fed will raise rates by 25 basis points, which will be the final increase. Even so, the analysts go on, the FOMC will likely continue to validate the dots while maintaining a hawkish tilt. It follows the tried-and-true “have your cake and eat it too” strategy. TD says they believe it will fail, which will result in a USD decline.
Further on the US dollar, TD say that since the Fed raised interest rates for the first time in 2022, there has been a very clear “buy the rumour, sell the Fed” trend surrounding the meeting dates. Prior to FOMC meeting, the USD had increased, but it then dropped throughout the day and into the overnight hours. TD expect that USD selling pattern to continue today, and sy the pattern is strong enough to outweigh the Fed’s statements.
This article was written by Eamonn Sheridan at www.forexlive.com. Source