Fed steps into the spotlight. Warsh "won't convince the majority", says the bank
According to the portal Axios, Iran has presented the United States with a new proposal regarding the reopening of the Strait of Hormuz and ending the conflict in the Middle East.
According to information provided by a representative of the U.S. administration and two other sources familiar with the matter, negotiations on Iran's nuclear program have been postponed to a later date.
Importantly, the White House received the proposal, but it is unclear whether Donald Trump's administration is willing to consider it.
"These are delicate diplomatic talks, and the United States will not negotiate through the press," said White House spokesperson Olivia Wales in an interview with Axios.
"As the president said, the United States has the advantage and will only make a deal that puts Americans first, never allowing Iran to possess nuclear weapons", she added.
Trump is scheduled to convene a meeting in the Situation Room on Monday, a crisis management center that will involve the national security and foreign policy team.
Analysts at UBS say that the current lack of breakthrough in the U.S.-Iran conflict will affect the Federal Reserve's April decision on interest rates.
"The Fed will likely keep rates unchanged at the April 29 meeting. Guidance on rates will likely be limited due to increased uncertainty and the approaching end of Jerome's Powell's term as president", they said.
"Recent macroeconomic data favor a wait-and-see approach. Employment rose in March by 178 thousand after falling by 133 thousand in February, and the unemployment rate slightly fell to 4.3%. Meanwhile, overall CPI inflation in March spiked due to higher energy prices," they added.
Experts expect core PCE inflation in March to rise to 3.2% on an annual basis, and real GDP growth to likely rebound in Q1 to 2.4% year‑over‑year.
"Powell will likely say that monetary policy is in good place. We still expect one rate cut this year, in December", the bank forecasts.
Fed chair candidate Kevin Warsh is unlikely to convince the majority to support rate cuts before that date given higher energy prices and divisions in the FOMC.
The federal funds rate in the United States has been in the range 3.5%-3.75% since December.
Source: Trading Economics.
Also read: Dollar rate on a long road to 4 PLN? Expert released forecasts for USD/PLN and EUR/USD. "The dollar may gain"
See also: Will the dollar surprise again? Expert released a forecast for USD/PLN and EUR/USD. "It's hard for me to believe there won't be more fires"
Dollar and euro rates on Monday, April 27
The dollar to zloty rate on Monday, April 27 is at 3.61 PLN.
Chart. Dollar to zloty rate (USD/PLN)
Source: TradingView.
The euro to dollar rate reaches 1.17 USD.
Chart. Euro to dollar rate (EUR/USD)
Source: TradingView.
Also read: Euro rate will soon surprise? Expert says what will happen with EUR/PLN and EUR/USD
See also: Dollar rate before a "nervous and dynamic" move, euro waiting for a drop? Expert released a forecast for USD/PLN and EUR/USD
Source: Axios.
