The Federal Reserve met last week to keep its policy unchanged with a vote of 9 - 1, but offset the same by coming out with a hawkish tone and keeping the December rate decision in play. The markets were caught on the back foot and the FOMC's statement saw the US Dollar quickly gain ground with December's looming decision likely to be a key player going forward into the year ahead. The RBNZ also met last week and kept policy unchanged. A broad pickup in Global dairy prices was some encouragement for the RBNZ which kept rates at 2.75%. The central bank however signaled its willingness to cut rates at the future meetings with the next RBNZ monetary policy decision due in December. The Kiwi was trading flat, caught between a hawkish Fed and a neutral RBNZ. Early Friday, the Bank of Japan announced that it would not be expanding its monetary stimulus program and stuck to its narrative that inflation could meet the 2% target range. The markets were divided on the BoJ's decision with some expecting to see an expansion at today's meeting. The Yen was trading volatile for the week and still remains range bound clearly waiting for a larger catalyst, which is increasingly pointing to the month of December where major decisions could be taken.
Central Banks Drive Market Momentum
Weekly Report - 02/11/2015