The FOMC meeting tomorrow will be a rollercoaster for the Dollar, rather weighing on it, in the opinion of Antje Praefcke, FX Analyst at Commerzbank.

If the Fed is determined to continue with its measures against inflation that would be positive for the USD

“If the Fed is similarly determined as the ECB to continue with its measures against inflation that would be positive for the Dollar, as the market would have to adjust its key rate expectations to the upside.” 

“To my recollection, the expectations before a Fed rate meeting have never been so far apart, from 0 to 25 to 50 bps. Nobody really knows what we will get tomorrow, it is a bit like taking a pick from a chocolate box. Perhaps at this stage, not even the central bankers themselves know at this stage, who, if they had a wish, would probably wish not to have a meeting this week.

“I fear that Powell will have to run the gauntlet at the press conference tomorrow and that the FOMC meeting will be a rollercoaster for the Dollar, rather than weighing on it.”