While no major changes are expected out of the Fed’s monetary policy statement itself, investors will want to make sure Powell remains as dovish as before during his press conference on Wednesday despite the improving macroeconomic data the U.S.
“Markets are starting to look for signs of tapering and Powell will surely be asked about the timing,” said BBH Global Currency Strategy global head Win Thin.
Given this, we expect Chair Powell to continue to defend the dovish stance of the Fed in Wednesday’s press conference,” said ABN Amro senior economist Bill Diviney.
“Progress toward the Fed’s targets is being made.
During every press conference held this year, Powell has been asked about the looming inflation risk.
The April meeting will not include any new macro forecasts or so-called dot plots, which show future rate expectations.
ETF investors are also exercising restraint at present, which can be seen as positive by comparison with previous months: the massive selling seen in February and March have now ground to a halt,” Fritsch added.
This should see an overshoot on inflation, which should keep the yellow metal supported for the interim,” MKS wrote on Tuesday.
“The value of gold above-ground to global money supply suggests the yellow metal is still cheap on this axis.