I think the statement from the meeting showed rates lift off will come around the middle of the year. We had comments by Fed member Charles Plosser saying he feels the Fed is really close to raising rates and the committee should look at removing the “patient” reference from the statement in March.
The minutes will give a bit more clarity on what to expect from the Fed regarding lift off. Hawks will be circling on the greenback and, particularly also heading into Janet Yellen’s testimony next week, positioning is likely to be skewed towards USD longs.
One pair to watch closely ahead of the minutes will be USD/JPY, as we are also getting some activity from the BoJ. USD/JPY is certainly coming to life again and managed to squeeze through ¥119.00 in US trade. The pair has been fairly sidelined in Asia but I suspect this is because traders are waiting for results from the BoJ meeting and Governor Kuroda’s press conference.
There is an uptrend that has been in place since October and this has been supporting the price action since then. Should the minutes come in fairly hawkish, then I would expect to see USD/JPY make its way towards ¥120.00.