How does the Fed meeting affect traders?
The FOMC meeting is usually considered the most important date on any traders’ calendar, for one overriding reason: interest rates.
Using a trio of policy tools, the FOMC can raise or lower the federal funds rate in the US.
This central rate change will trickle down to other interest rates, including FX rates and bond prices, which can have a big impact on traders.
Which markets are affected by the FOMC?
If the FOMC chooses to raise or lower interest rates, the effects will reverberate across global financial markets. Here are a few specific markets to watch out for:
So traders and investors around the world will attempt to predict where monetary policy is headed next in each Fed meeting, and adjust their strategies and portfolios accordingly.
Find out more about how the FOMC affects interest rates.