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20 Aug 2015
Fed's normalisation path revisions - Scotiabank
FXStreet (Guatemala) - Eric Theoret, CFA, CMT Currency Strategist at Scotiabank noted that the USD weakened broadly in response to Wednesday’s (early, leaked) release of FOMC minutes.
Key Quotes:
"Market participants considered the moderation in policymakers’ confidence in reaching their inflation objective despite ongoing improvement in labor market utilisation."
"Staff forecast revisions provided for a downward adjustment to the inflation projection — below target through 2017 — alongside a modest lowering of both potential growth and the longer-run natural rate of unemployment. Such changes suggest a softening of both the timing and size of the Fed’s normalisation path."
Key Quotes:
"Market participants considered the moderation in policymakers’ confidence in reaching their inflation objective despite ongoing improvement in labor market utilisation."
"Staff forecast revisions provided for a downward adjustment to the inflation projection — below target through 2017 — alongside a modest lowering of both potential growth and the longer-run natural rate of unemployment. Such changes suggest a softening of both the timing and size of the Fed’s normalisation path."