In the Asian session on Monday (June 12), the U.S. dollar index fell back from a high, with the latest price of the U.S. dollar at 103.54, a decrease of 0.01%. At present, it seems that the possibility of the Fed‘s hawkish guidance in exchange for “skipping” the June rate hike is increasing-specifically, the Fed may raise its own interest rate hike forecast by the end of 2023 from the previous remaining 0 times to plus 1 -2 times.
The latest from the Federal Reserve:
But on the other hand, because the market has begun to look forward to raising interest rates near the end, or even cut interest rates soon, any cautious or even neutral approach of the Fed may be “interpreted by doves” by the market and automatically loosen financial conditions and further push up inflation expected. Therefore, in order to emphasize that skipping interest rate hikes does not mean suspending or even stopping interest rate hikes, the Fed may raise the forward guidance 1-2 times as a trade-off. First, it will gain an observation window for itself and maintain the flexibility of subsequent shifts, but at the same time, it will not be affected by the market. considered too dovish.
