Baku. 16 March. REPORT.AZ/ Baku. 16 March. REPORT.AZ/ Today, the US Federal Reserve (Fed) will hold a regular meeting. It is expected that the Fed chief Janet Yellen will deliver a final decision.
Analytical Group of Report News Agency believes that the Fed may raise interest rates from 0.25% to 0.625% at today's meeting. Conditions are favorable to do this.
First, economic indicators released by the US exceeded the projected figures in the first quarter of 2016. The unemployment rate fell to 4.9%, the index of basic consumer goods at an annual rate higher than 2%, economic activity reached its highest point.
Secondly, it should be noted that due to the lack of stability in the global economic markets in previous meetings the Fed interest rates were not increased. Currently, this obstacle is removed. Thus, the global stock markets after the February minimum reduction increased by 10-15%. In the currency market the situation is also stable. Rate of USD/EUR is around 1.11. Notably, appreciation of Euro against US- dollar is about 6% after a mark 1.0460, registered March 9, 2015. That's, dollar for the last year has fallen in price, which corresponds to the requirements of Fed. Since the strengthening of the dollar slows the pace of the US economy, the export decline. On the commodities market is also observed positive dynamics. The cost of oil with the minimum price increased by 40%, and gold in January - about 20%.
Third, China's economy has a relative lull. Yuan in recent days has increased by 1.5%, the Shanghai Stock Exchange are at the level of 2900 points.
Current economic conditions are favorable for increasing the Fed's interest rate. At subsequent meeting may change one or more of the above factors. If the Fed wants to raise interest rates and make a decision today in this context, a strong reaction of the financial markets is expected. That's to say, what must be, must be.