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Change in Fed language very likely - FXStreet

FXStreet (Łódź) - Alberto Muñoz, Forex Analyst at FXStreet, believes that even though the FOMC shouldn't make any adjustments to its monetary policy at today's meeting, it is possible we will see a change in the wording of the statement.

Key quotes

"In particular, the Fed will probably drop 'considerable time' from 'lift-off is still a considerable time away' in its assessment, thus changing its forward guidance."

"Even though apparently it's not a significant change, actually it's a big change indeed, which could drive EURUSD below 1.2900 after the release of the statement."

"We shouldn't forget that the Fed expects economic growth to continue expanding and that labor market performance will continue to improve; also July FOMC minutes showed that some Fed hawks such as Philadelphia Fed President Plosser are putting pressure to reduce stimulus faster."

"By changing the language in the statement, Yellen will please the hawks as well as signal the market that a rate hike is coming sooner than later."

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