In recent speeches, two high-ranking officials from America鈥檚
Federal Reserve Bank gave conflicting indications regarding the likelihood of
rate cuts next month. Both officials were deliberately ambiguous in their
speeches, though one went so far as to rule out a rate cut while the other
hinted at its inevitability. Nonetheless,
analysts used the speeches to buttress their conclusion that a rate cut is
probable. In fact, the futures market
has priced in a 94% chance that rates will be cut by 25 basis points at the
next meeting, on December 11. Likewise,
it seems a rate cut has already been priced into the USD, which was virtually unaffected
by this story. MSNBC reports:
On the currency markets, the heightened expectations of a US
rate cut cut did little to hurt the dollar, as investors took the view that the
currency's recent weakness had gone far enough.
Read More: Fed stance sends equities soaring
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