The U.S. is back at the forefront today with the FOMC meeting. Most analysts expect the Fed to announce the massive purchase of securities to support economic growth. Operation Twist, which consisted in selling short-term securities to buy longer-term debt, is scheduled to end this month.
This operation did not increase the central bank’s balance sheet, contrary to the program expected this morning, which should bring it up past $4 trillion. This would have a thoroughly negative impact on the greenback, though it appears to have already been discounted for the most part. The FOMC announcement will be on Wednesday afternoon.
However, the Fed’s actions would be scotched by a potential breakdown in fiscal cliff negotiations between President Obama and House Speaker John Boehner. According to several sources, negotiators from the NHL could come lend a hand shortly...
There is a bit of hope on the horizon in Germany this morning, with the results of the ZEW Economic Sentiment Index surpassing expectations at 6.9.