Fed Chair Powell: We would eventually roll back support programs

TVC:DXY   U.S. Dollar Index
"The amount of fiscal support the economy has received is historically large and that's going to result in higher economic activity and hiring," Federal Reserve Chairman Jerome Powell said in an interview with NPR's Morning Edition, on March 25.

According to Powell, the Fed is moving to deactivating the lending facilities, and will gradually roll back the amount of Treasury and mortgage-backed securities that they're buying, these moves will enable them to raise interest rates in a longer run.

The market is predicting a recovery on the USD, after discerning a turning point of the expansionary monetary policy.

MM Analysis
Apart from the interview of Powell, the Unemployment Insurance Weekly Claims has also dropped from 770 thousands to 684 thousands (better than expected), showing a robust recovery from COVID-19.

The senate has also extended the Paycheck Protection Program (PPP) application deadline from March 31 to May 31, providing an even stronger support on the employment recovery.

Besides, President Biden has named a new goal on vaccinations - 200 million in his first 100 days (Currently 130million). If the vaccination rates continues, the herd immunity schedule might be achieved in advance in June.

Overall, with a strong support on vaccination and employment, we should focus on the robust economic recovery of the US when making investment decisions. The USD would recover, with a sign of the end of expansionary monetary policy.


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