FOMC speculation

The consensus is an obvious hold at the current degree 5.25% but wednesday's statement may still, as always, have major ramifiions on USD based on what exactly the tone and intensity of this wording is. Fed speeches have been fairly bland but I think wednesday might shake up things.

Stocks are soaring at record highs, oil prices are decreasing (maybe long-term), home is slowed but is not chilly (housing starts a week high than expected), unemployment rate is down, CPI was more negative than expected but core CPI is right on, PPI was much lower than expected. Appears to be a mixed bag of economic news, who knows how that will be interpreted by the fed or what exactly the big money is anticipating.

I think that if the fed reiterates its point about becoming more concerned with instant inflation then that will definitely help the dollar, but if it appears to dismiss past inflation issues in favor of a more growth centered tone then its going to hurt the dollar.

What would you all think?

It’s definitely a mixed economic picture, making Fed interpretation tricky. Strong stocks, moderate housing, and low unemployment show growth resilience, while CPI and PPI data suggest easing inflation pressures. If the Fed signals a focus on controlling immediate inflation, the USD could strengthen. Conversely, a more growth-focused tone may weaken it. Traders should watch the exact wording and tone closely, as even subtle shifts in the Fed’s message can drive short-term volatility in USD and broader markets.