Today the Federal Reserve will begin an important policy meeting regarding interest rates. The Fed is expected to discuss the number of rate increases for 2018: initially three increases were promised, but recent economic data suggests that four might be needed. They would also discuss whether to hike rates now - something that is quite eagerly anticipated by analysts. In fact, everyone seems so certain a rate hike will take place that if it does not, likely the USD will suffer. We would hear about the outcome from the meeting tomorrow.
Turbulence continues on the market for oil. There is currently a conflict between Saudi Arabia and Iran which is impacting proper supply, thereby bringing the prices of oil higher. The WTI right now is trading around $62.63 per barrel, while the Brent crude is at $66.58. However, we don’t expect these highs to remain for long, as production in the US continues to offset the oil market.
We also just received positive news from the United Kingdom where inflation slipped from 3% to 2.7%, paired with wage growth. This gives the UK something positive to use in the next round of negotiations with the EU which starts this Thursday.
