The two-day meeting of the US central bankers of the Federal Open Market Committee of the Federal Reserve System FOMC FED (Federal Open Market Committee Federal Reserve System), which took place on 31.10. and 1.11. of this year 2023 and by a majority vote of the members of that banking body decided to keep interest rates unchanged, but tightened its monetary policy towards bonds. Thus, interest rates remained at the same level, ranging from 5.25% to 5.50% per year, therefore similar to the September meeting of the FOMC, the FED did not change interest rates.
Currently, during European Thursday noon on November 2, 2023, at approximately 11:57 CET, in response to the decision of the central bankers of the United States from the FOMC FED, the trading trend of the exchange value of the American dollar (USD) changed, in a decrease according to the dollar index DXY (US Dollar Currency Index) by -0.72% of the point value at 106.11 USD points according to this index, which compares the value of the USD with six major world currencies. The most widespread and tradable global currency pair of the single European currency Euro (EUR) and the US dollar (USD) traded at a mutual exchange rate of USD 1.063 in forex operations on the indicated day and time, with the EUR + 0.63 up on the day so far % against the USD, the US dollar also weakened against the British pound (GBP) and traded at 1.219 USD against the GBP with the GBP gaining +0.35% against the USD on the day so far.
On Wednesday, November 1, 2023, the Federal Reserve System Rating Group unanimously agreed to keep the key federal funds rate (base interest rate) in the target range between 5.25%-5.5% per annum. These interest rates in this amount are valid from July this year 2023. This meeting, which took place at the turn of October and November this year 2023, was the second consecutive meeting of the FOMC FED, which after a series of 11 rate increases, including four in 2023 it left rates unchanged. The FOMC Fed members’ decision included an upgrade to the committee’s general assessment of the economy. In response to this decision, the US stock market in particular strengthened, where the main stock indexes recorded an increase in their previous point value. For example, the prestigious stock index Dow Jones Industrial Average (DJIA) closed yesterday’s trading day on January 1, 2023 with a daily increase of +0.67% point value.
“The process of reducing inflation in a sustainable manner to 2% still has a long way to go,” said Fed Chairman Mr. Jerome Powell at a press conference, which took place as always after the end of this FOMC Fed meeting. Mr Powell stressed that the central bank had not yet made any decisions for its December meeting, saying “the committee will always do what they think is appropriate at the time”. Fed chief Mr. Powell added that the FOMC is not considering or discussing a rate cut at the moment. Mr Powell also said the risks surrounding the Fed doing too much or too little to fight inflation had become more balanced. “This signals that while there is potential risk that the Fed will do more, the bar for rate hikes has been raised and we’re clearly seeing that play out in two consecutive Fed meetings with no policy action,” said Charlie Ripley, senior investment strategist at Allianz Investment Management.
