Minneapolis Fed President Neel Kashkari noted that a few months of good data were not sufficient to determine whether inflation was under control. Ac
Minneapolis Fed President Neel Kashkari noted that a few months of good data were not sufficient to determine whether inflation was under control. According to Kashkari, there’s a long way to go before Fed reaches its inflation target.
The FedWatch Tool indicates that there is 76.4% probability that Fed will leave the interest rate unchanged at the next meeting in June. Unlike Fed speakers, traders expect that Fed will cut the interest rate from 500 – 525 bps to 425 – 450 bps by the end of this year.
Traders Should Keep An Eye On Debt Ceiling Negotiations
The comments from Fed speakers did not provide any material support to the U.S. dollar, which pulled back against a broad basket of currencies. Gold moved higher as traders focused on the U.S. debt ceiling story.
In the near term, debt ceiling negotiations could serve as the main catalyst for markets, so comments from Fed speakers may have less impact on market dynamics. While most analysts believe that U.S. will come up with a last-minute solution to the debt ceiling problem, traders should be prepared for additional volatility in the upcoming weeks.
For a look at all of today’s economic events, check out our economic calendar.
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