16/03/2017 - Fed Hikes, Remains Cautious - 16/03/2017
As widely expected the US raised interest rates for the second time in three months, a move spurred by steady economic growth, strong job gains and confidence that inflation is rising to the central bank's target.
The rate increase to 1% lead to the Dollar initially weakening as the FOMC did not flag any plan to accelerate the pace of monetary tightening, after raising interest rates for only the third time since the financial crisis.
The statement said further rate hikes would only be gradual as officials stuck to their outlook for two more rate hikes this year and three in 2018.
The vote to hike rates was one sided with 9 votes for in favour of a hike. Only Neel Kashkari preferred at this meeting to maintain the existing target range for the federal funds rate.
The Pound received some much needed support after the jobless rate in the U.K. surprised with a slight drop to a fresh 11-year low in January, while wage inflation slowed more than expected, official data showed on Wednesday.
The Office for National Statistics said that the rate of unemployment dropped to 4.7% in the three months to January, beating expectations for it to remain steady at the prior 4.8%.
In the closely watched Dutch election yesterday, exit polls showed that voter turnout was 81%, the highest in three decades. Preliminary results pointed to a win for Prime Minister Mark Rutte, with the right-wing Geert Wilders coming in second with a worse-than-expected result.
12:00 - GBP : MPC Official Bank Rate Votes
12:00 - GBP : Official Bank Rate
12:00 - GBP : Monetary policy summary
12:30 - USD : Building permits
12:30 - USD : Unemployment claims
12:30 - USD : Philly Fed Index