Will the CPI Crash the USD?
The most impactful releases of this week will fill the market with volatility and sharp movements. Be ready to take action!
Will Fed Raise Interest rate?
What will happen?
On March 16, 2022, the US Federal Open Market Committee (FOMC) will make a statement and economic projections and, after that, the Federal Reserve will publish the Federal Funds Rate. This data comes out 8 times a year. An interest rate decision itself is usually priced in by the market in advance, so a forward-focused FOMC statement tends to outshine the rate announcement, especially if there’s no surprise in the rate.
How will it affect the dollar?
This release is the primary tool the FOMC uses to communicate with investors on monetary policy issues. Decisions made on this day add volatility to the market. In addition, press conference questions often lead to unplanned responses and increase volatility even more.
After the last release, USD rocketed by 560 points and then kept rising for some time.
How to trade on the Fed Funds rate release?
If the “Actual” rate is higher than expected, it is good for the currency. However, don’t underestimate the FOMC statement and press conference questions, which often lead to unplanned responses. The conference can trigger an opposite reaction in USD.
- If the release is hawkish – the USD will go up.
- Otherwise, it will fall.
Check the Economic calendar
Instruments to trade: EURUSD, USDCAD, USDCHF, US500, US100.
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