US Dollar Down Amidst Fed Rate Cut, What Impact Will US GDP Have on Thursday?
The US dollar plunged across the majors on Wednesday, but the decline came primarily during the European trading session and start of the New York trading session in anticipation of the Federal Reserve’s rate decision. The Fed pulled no surprises as they cut rates by 50bps to a more than 5-year low of 1.00 percent amidst a marked slowing in economic activity and weak consumer spending. Likewise, slowdowns in many foreign economies has created dim prospects for US exports, suggesting that upcoming GDP figures on Thursday should signal a recession. The Fed touted an array of different policy actions implemented recently, including the October 8 coordinated rate cuts and efforts to boost liquidity, saying that they should help to “improve credit conditions and promote a return to moderate economic growth.” However, the central bank also noted that “downside risks to growth remain,” and combined with outlooks for more moderate inflation, the Fed seems likely to cut rates even further befor
