Jan 29
FOMC: Preview of policy meeting
Overview: On Wednesday night at 20:15 CET the Federal Open Market Committee (FOMC) will announce its policy rate decision. Following the 75bp inter-meeting easing last week, markets have currently settled with 86% probability of a 50bp cut at the upcoming meeting. We doubt that the FOMC has any desire of disap-pointing in the current environment, and expect a further cut by 50bp to 3.00% at WednesdayÂ’s meeting. However, if equity markets recover significantly ahead of the meeting, the risk is