The chairman of the Federal Reserve System, or the central bank of the US Federal Reserve System (FED), Mr. Jerome Powell, is going to deliver today, Thursday, October 19, 2023, local afternoon time in New York, what could be considered by investors and other participants in the financial market with a key monetary policy statement. Financial markets largely expect the Fed’s Federal Open Market Committee (FOMC) to keep rates higher for an extended period of time, but investors and financial market traders will be looking to Fed Chairman Mr. Powell in his speech for confirmation as well as an explanation of this.
Not only on the basis of this investor sentiment before the expected speech of the head of the FED, Mr. Jerome Powell, during the European Thursday morning on 19/10/2023, at approximately 7:09 CET, the exchange value of the US dollar (USD) found itself in the current trading trend of its strengthening and according to the dollar index DXY (US Dollar Currency Index), the exchange value of the USD against other world currencies increased by + 0.04% of the daily point value according to this index, which compares the value of the USD with another six major world currencies. Thus, on the indicated day and time, this index showed its point status of 106.6 USD points, and the so-called global currency pair of the single European currency, the euro (EUR) and the US dollar (USD), as the world’s reserve currency in the forex operations of the foreign exchange market traded at a mutual exchange rate of 1.053 USD to the EUR with the EUR down by -0.019% against the USD on the day to date.
In his speech, the highest creator of the monetary policy of the United States of America, namely the chairman of the US central bank as head of the Federal Reserve System (FED), Mr. Jerome Powell, according to economic reporters, probably intends to convince investors, traders and the rest of the public that the central bankers who are in the Federal Committee for the free market (FOMC-Federal Open Market Committee) are doing everything to suppress inflation and are determined to do everything so that the set inflation target of two percent annual inflation in the United States is met as soon as possible. While current so-called inflation numbers have been improving recently, government bond yields are rising, sending mixed messages about where monetary policy might be headed. Markets largely expect the US Federal Reserve System (FED) to keep rates unchanged, but financial market participants will logically look to Fed chief Mr. Powell to confirm and explain how other FOMC members view the Fed current conditions and long-term trends.
According to economic news reports, Mr. Jerome Powell is scheduled to speak at the Economic Club of NY today, Thursday, October 19, 2023, at noon local time in New York on the east coast of the United States, at a time that, according to financial analysts, is for the US economy to critical. “Powell always comes back to what helps feed the story they need to stay alert, and for obvious reasons,” said Luke Tilley, chief economist at Wilmington Trust. “I just expect him to continue to talk about the strength of the economy and the surprising strength of the consumer in the third quarter as a risk to inflation. That’s enough ammunition to keep talking about staying vigilant,” said the economist. Basically, Mr. Tilley expects Powell’s report to break down into three parts: The Fed needed to get rates high quickly, which it did; that it had to find the highest level, which is part of the current discussion; and that he needs to find out how long rates need to stay this high for inflation to return to its 2% target, economic correspondents commented on Mr. Tilley’s statement.