Although yesterday’s FOMC meeting revealed an upbeat view of the US economy, markets came under pressure as officials admitted to be also focused on “international developments” in order to weigh an interest rate change. The committee focused on having “patience” but also dropped the “considerable time” terminology, thus strengthening the belief that a rate increase is still likely in the latter part of the year. Today, however, markets responded negatively as the dollar strengthened against other major currencies and the new Greek government challenged some of the bailout conditions. The uncertain outlook in Europe is causing investors to chase less-risky assets as seen by the decrease in bond yields across several markets.
Investors will focus closely on the weekly jobless claims report today as a gauge regarding yesterday’s FOMC meeting.