Source: ForexYard
The FOMC statement did not contain any surprises and the Fed did not announce its intention to begin another round of asset purchases (QE3). What the Fed did do was downgrade its assessment of the US economy to bring the central bank in-line with market consensus. Slower growth and higher unemployment is expected to continue to weigh on the US economy.
The accompanying statement did point to stronger than expected growth in Q3 vs. the first half of the year and spending had improved though unemployment remains uncomfortably high. The highlight from the statement though was the dissent from Chicago Fed Governor Charles Evans who wanted additional stimulus. Also important to note was the absence of any hawkish vote against the Fed’s policy. Expectations for the Fed to enact QE3 will now shift to the December 13th meeting.
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