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Fed statements affect global economy
04-10-2022 16:04
Fed statements affect global economy
Fed statements affect global economy

The US Federal Reserve System proved to be the world's most influential financial regulator. Its influence is so powerful that just one statement is enough for global economic shifts, even without the use of any financial instruments. CNBC analysts confirm that Fed’s statements have such a far-reaching effect. The regulator officials’ words shape the US monetary policy and echo in almost every corner of the world. The Fed is likely to use speculative statements called the Open Mouth Operations to adjust monetary policy. Even the tiniest detail posted in its reports may hint at the regulator’s further steps. Based on the Fed's forecasts, investors are trying to draw conclusions about the future cost of borrowing in the market and the US dollar rates. “I think he [Fed Chairman Jerome Powell] puts up a bulletin board behind him that says 'Inflation Has to Come Down,'” Rick Rieder, BlackRock chief investment officer, said. In addition, the US regulator is expected to raise its benchmark interest rate, the federal funds rate, by 0.75% to a new range of 3.0% to 3.25%. At the moment, the rate is fixed at 2.25%-2.5% on the yearly basis.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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