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17 Jul 2013
Flash: Market will be muted to Bernanke – BofTM
FXstreet.com (London) - Derek Halpenny at Bank of Tokyo-Mitsubishi UFJ, Ltd. Suggests there will be a muted reaction from markets to Bernanke.
“In a sense what can Bernanke tell us that we already don’t know?”, he asked. He expected the testimony to confirm tapering later this year and to reiterate the other consensus within the FOMC, that a federal funds rate increase will not happen until 2015. “Dollar long positioning has lightened up considerably since last Wednesday and hence an as expected testimony that confirms tapering this year should be more supportive for the dollar”. He said the dollar bid tone to the market this morning suggests positioning is now more favourable for the dollar.
“In a sense what can Bernanke tell us that we already don’t know?”, he asked. He expected the testimony to confirm tapering later this year and to reiterate the other consensus within the FOMC, that a federal funds rate increase will not happen until 2015. “Dollar long positioning has lightened up considerably since last Wednesday and hence an as expected testimony that confirms tapering this year should be more supportive for the dollar”. He said the dollar bid tone to the market this morning suggests positioning is now more favourable for the dollar.