The US Fed: salvation cometh

The US Fed: salvation cometh

Economy bailout

Until recently, observers were complaining that the US Fed’s financial aid was not enough to keep the American economy going at acceptable pace. Well, it seems their prayers were heard: the Fed is opening its unlimited power to the market now. Its’ aid will be literally unlimited: Jerome Powell’s team promised to buy as many government-backed bonds and mortgage-backed securities as its required to ensure the virus hit doesn’t inflict too much damage. “Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate”, the Fed stated on Monday.

Essentially, that means, while the congress keeps discussing a $2trln stimulus, the Fed steps in to finance businesses and individuals directly, extending their support much beyond critical parts of the economy. That’s about time: observers predict the inevitable recession to the US economy and job losses in the rage of 1mln due to the coronavirus.

Forex

The US dollar responded immediately, as it was supposed to just like in any other case of such a large currency influx: it eased its grip on the market. Even the weak currencies such as MXN, TRY and RUB got an opportunity to relax a bit after an unstoppable onslaught of the USD. Gold surged as well, taking back its privileges as a safe-haven commodity.

EURUSDH4.png

Stocks

S&P dropped to 2175 – its lowest market since 2016. But the Fed’s actions made it get back up to 2320. Observers comment that although there still is certain bearish potential, there are reasons to expect recovery over the pass. For this reason, it is a good moment to watch for the pick-up signs for a possible buy in the nearest future.

S&P500H4.png

                                                                                            LOG IN

Similar

USD starts the week with gains
USD starts the week with gains

Poor US data, slow vaccine distribution, rising virus cases worsened the market sentiment and underpinned safe-haven currencies like the USD, and JPY.

Latest news

ECB report is in focus
ECB report is in focus

The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time. 

Deposit with your local payment systems

Learn more

Data collection notice

FBS maintains a record of your data to run this website. By pressing the “Accept” button, you agree to our Privacy policy.

Callback

Manager will call your number

Correct number

Your request is accepted

Manager will call your number

Next callback request for this phone number
will be available in {time}

If you have an urgent issue please contact us via
Live chat

Internal error. Please try again later

Don’t waste your time – keep track of how NFP affects the US dollar and profit!

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

Beginner Forex book

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera