The US central bank’s Federal Open Market Committee started today its two-day monetary policy meeting which is going to conclude on Wednesday, when the Fed will announce its decision.

Markets widely expect a quarter-point hike to 1.5%, with focus turning towards Fed’s chair Janet Yellen’s press conference, due after rate decision.
Traders are looking for the language of the Fed after its rate decision to get more clues about near-future monetary policy trajectory.

The US central bank will release forecasts for economic growth and interest rates in 2018. The Fed has already announced forecast for three rate hikes in 2018, with hawkish hike on Fed’s last meeting in 2017 expected to signal more aggressive approach to the monetary policy in the next year and sideline existing skepticism in the markets about the central bank being able to hike rates according to expectations.
The US dollar stood at the front foot against the basket of its major counterparts in past two weeks, being driven by recent solid US data and strong expectations for rate hike and more hawkish approach in the coming months.
Hawkish tone in Yellen’s post-rate decision comments is expected to further inflate the greenback and send prices of its major counterparts and dollar-denominated commodities lower.

The FOMC will announce its interest rate decision at 19:00 GMT on Wednesday, 13th December 2017, with Fed chair Janet Yellen’s press conference due half an hour later at 19:30 GMT.