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Fed: Less Risk, More Slack: Implications On FX - BofA Merrill
The FOMC tapered by another $10 bn and made no changes to their policy language, confirming expectations. The Fed marked-to-market their assessments of growth, unemployment and the downside risks to inflation, which have diminished somewhat, notes Bank of America Merrill Lynch. "However, they countered that more optimistic view by noting upfront that “there remains significant underutilization of labor resources.” On net, this appears to be a mildly more dovish statement, and the rates and FX markets interpreted it as such following its release. Philadelphia’s Plosser dissented on the time-dependent nature of ... (full story)