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5 Aug 2013
Flash: September meeting still pegged as start of Fed tapering – UBS
FXstreet.com (New York) - July's US employment report has cast doubt on whether the Federal Reserve will announce at its next Open Market Committee meeting on September 17-18 that it will start tapering its asset purchases from Q4 2013, suggests Mansoor Mohi-uddin, head of Foreign Exchange Strategy at UBS.
Key quotes
As a result the dollar ended Friday down around 1.33, 99.00, 1.53 and 0.93 against the EUR, JPY, GBP and CHF respectively. However, “at its current weaker levels, the dollar looks attractive – the US economy has been held back by this year's payrolls tax increases and government spending cuts.”
“America's central bank remains on course to begin cutting the pace of its bond buying this year with an announcement at September's FOMC meeting still more likely than not. That suggests the Fed will be the first of the major central banks to start exiting unconventional monetary policy. In our view investors should thus maintain an underlying bullish view on the dollar.”
Key quotes
As a result the dollar ended Friday down around 1.33, 99.00, 1.53 and 0.93 against the EUR, JPY, GBP and CHF respectively. However, “at its current weaker levels, the dollar looks attractive – the US economy has been held back by this year's payrolls tax increases and government spending cuts.”
“America's central bank remains on course to begin cutting the pace of its bond buying this year with an announcement at September's FOMC meeting still more likely than not. That suggests the Fed will be the first of the major central banks to start exiting unconventional monetary policy. In our view investors should thus maintain an underlying bullish view on the dollar.”