Fed on hold as we wait for Trump's decision on trade deal – Danske Bank

Analysts at Danske Bank a brief preview of Wednesday's highly anticipated FOMC decision, wherein the US central bank is expected to leave interest rates unchanged.

Key Quotes:

“Today's main event is the Fed meeting with the rate announcement at 20:00 CET. As most FOMC members have said they think the current stance of monetary policy is appropriate, the Fed is now on hold after three cuts in a row. Political uncertainty has declined, global growth has stabilised and US recession fears have eased after strong job reports lately. Most will look at the 'dots' for hints about what the Fed thinks about next year. Given the Fed has cut one more time than it thought in September, it will automatically be lowered but we think the Fed will signal it is on hold also next year. Markets are pricing in another cut during 2020.”

“Otherwise, we get inflation data in Sweden and the US. The latter is probably not a market mover but the Swedish number is interesting in the light of the Riksbank's monetary policy decision next week.”

“We will continue to monitor any comments on the ongoing US-China trade talks ahead of the 15 December deadline, when the US is set to increase tariffs on more imported goods from China. Yesterday there was a story that the US is planning to postpone the tariffs despite a phase 1 trade deal not having been signed yet.”