3 reasons the dollar could rally (even without a rate hike)
The Federal Reserve has maintained its Fed Funds rate at 0% (the so-called Zero Interest Rate Policy or ZIRP) for fully six-and-a-half years in an effort to stimulate the economy and bring down the unemployment rate. The Fed Funds rate will be at the same level come this time tomorrow, despite encouraging signs of a “spring thaw” in economic activity.
Now that we have that inevitability out of the way, let’s get into what actually could change. In our view, there are three major areas of focus for tomorrow’s Fed bonanza.