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Fed: Placeholder assumptions – Rabobank

The Fed is likely to keep the target range for the federal funds rate unchanged at 4.25-4.50% this week, Rabobank’s Senior US Strategist Philip Marey notes.

Fed to keep the target range for the federal funds rate unchanged

“We expect Powell to stress that the FOMC is data-dependent and cautious about further cuts, while dodging questions about the impact of Trump’s policies on the Fed’s rate path.”

“The FOMC and the Fed staff are struggling to incorporate the policies of the new administration in their forecasts, but once Trump’s policies have been fully incorporated in the projections, we expect the rationale for a second rate cut this year to fade.”

“While the Fed and the markets still expect two rate cuts this year, we think that the likely inflationary impact of tariffs and increased border security will cause a pause in the cutting cycle after one final hike in the coming months.”

AUD/USD plummets below 0.6250 as US Dollar strengthens amid dismal market mood

The AUD/USD pair plunges below 0.6250 on Tuesday. The Aussie pair weakens as the US Dollar (USD) performs strongly in a highly risk-off market environment.
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Gold: CTAs are now set to buy Gold – TDS

Gold markets were swept into the quant fund leveraging last session, but CTAs are now set to buy Gold in every reasonable scenario for price action over the coming sessions, TDS’ Senior Commodity Strategist Daniel Ghali notes.
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