The New York Federal Reserve’s President William Dudley sent bond yields tumbling yesterday as comments about the outlook for rates mixed expectations after stronger employment data raised optimism of an imminent hike in the September meeting. After refusing to analyze the latest moves by Chinese policymakers to revalue the Yuan, in a stark reversal from his position earlier in the month, Dudley remarked that the Federal Reserve “can hopefully raise rates in near future.” The lacking confidence in his comments echoes comments from Federal Reserve Vice Chairman Stanley Fischer who highlighted other risks to the liftoff scenario, namely inflation which has failed to move back towards longer-term targets. The dollar softened further against peers during yesterday’s session before staging a rebound late in the session with momentum higher continuing overnight against the Euro and Yen.
Liftoff Uncertainty Rises
Daily Analysis - 13/08/2015