HiFX Morning Update, September 22 2016

The NZDUSD opens at 0.7325 (mid-rate) this morning.

This morning the Federal Reserve once again, and in line with expectations left its policy rate unchanged, while also signalling that a 2016 rate hike is still on the cards. Below are the key points from this morning’s statement.

Near-term risks to the economic outlook appear roughly balanced
The Committee judges that the case for an increase in the federal funds rate has strengthened but decided, for the time being, to wait for further evidence of continued progress toward its objectives
Three officials, the most since December 2014, dissented in favour of a quarter-point hike.

Although the unemployment rate is little changed in recent months, job gains have been solid, on average
Fed continues to closely monitor inflation indicators and global economic and financial developments
Borrowing costs will probably rise at an “only gradual” pace
Inflation expected to rise to their 2 percent goal over the medium term.
Median growth projection for 2016 cut from 2% to 1.8%
The NZD is little changed in reaction to the announcement with the RBNZ due to release its own police statement at 9:00am.

Global equity markets are in positive territory - Dow +0.52%, S&P 500 +0.26%, FTSE +0.06%, DAX +0.41%, CAC +0.83%, Nikkei +1.75%, Shanghai +0.77%.

Gold prices have gained 1.4% to be trading at $1,333 an ounce, WTI Crude Oil is up over 4% currently trading at $45.29 a barrel

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