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we have reached the day of the US Federal Reserve Bank meeting
welcome to a new report about QE program
In two hours we will get to the announcement
from the Federal Reserve Bank regarding the quantitive easing program
the tension the Federal Reserve Bank is now witnessing
due to high unemployment rate, low growth and fear of entering into a phase of deflation
this Tension has resulted in tension in markets
especially foreign exchange market
even the Japanese central bank moved its meeting date
to tomorrow and the day after
in anticipation of FED meeting results
to *** how it can show all its weapons !
the Federal Reserve Bank has many possible Scenarios of action
and the five most talked- about of these are :
first Scenario is that FED will buy Treasury bonds
in the value of 250 $ billion each time
for three times , every three months
this scenario may weaken the dollar if the FED decides to do it
second Scenario is that the FED might buy bonds for several months
each month in the amount of 100 billion $
if the FED decides on this option we will witness increase in Dollar strength
Third scenario which is already discounted in markets now and expected
is that the FED will buy 500 $ billions in bonds,
and if FED decides on this Scenario
we will witness weakness in dollar
especially that it is expected to present a promise to re-interfer whenever it is needed.
as for the fourth Scenario
there is some conflict inside the Fed
if the opposing members were able to
convince the rest of the members to wait and not go with the program
then we will witness a great increase in Dollar strength
fifth scenario is that FED might surprise markets
by buying bonds
in the value of 2-4 trillion $
and this will have huge influence on weakening the dollar strength
even if FED states that this process will be gradual and on stages
we also have many important news for the rest of the week
such as Japanese central bank meeting tomorrow and the day after
also the very much awaited for employment report from US on Friday.
which Scenario will the FED possibly take ?
let's see together what might happen after just few hours.
after the FED resolution and the employment report
we will meet again in the coming week and a new market report