Week Ahead: FOMC Hawkish Surprise, BoJ, BoE, SNB On Hold

Next week will see some important central banks meetings.

Starting with the Fed, Credit Agricole CIB expects the FOMC to hike but leave its forward guidance little changed and thus not necessarily trigger further tightening in the US financial conditions

However, CACIB believes that if there is scope for a surprise next Wednesday, it is likely to be a hawkish surprise.

"This much should be sufficient to keep the USD supported across the board. With markets still long on risk-correlated and commodity currencies, they should remain rather vulnerable. This will be particularly the case if the upcoming G20 meeting highlights the growing prospects for rampant US protectionism from here," CACIB argues.

Elsewhere, CACIB expects the BoJ, BoE, and SNB to hold their policy meetings next week projecting that they will likely be uneventful and have less of an impact on G10 FX.

Source: Credit Agricole CIB ResearchOriginal Article