Fed Governor, Jerome Powell, still has work to prepare a number of provisions to determine the interest rates, although until now he has cut the interest rate of nearly 0%. The Fed was busy pouring several numbers of credit stimulus to sustain liquidity when the economy was hit by the pandemic.

Jerome Powell and colleagues at the Federal Open Market Committee (FOMC) still have one task to adjust the interest rates. The public is pressing for certainty how long the interest rates will still low. Until this Tuesday, the fed interest rate is 0.25.

This is predicted to trigger a discussion about the provisions on compiling the reference interest and will be a discussion at the FOMC meeting from Tuesday to Wednesday (28-29 / 4). Although many people consider the conversation to be held too early.

At present, the Fed is urged to provide commitment guidelines to immediately strengthen expectations for a solid economic recovery. "Reducing the benchmark rate by rising inflation expectations, and encouraging business people to take out more loans, instead of reducing costs and keeping quiet," said Vice Chair Evercore ISI, Krishna Guha. 

On March 15, when the FOMC cut borrowing costs to almost 0%, they said the level would be maintained until the economy could cut unemployment rates and prices stabilized. In fact, up to now millions of people have actually lost their jobs due to social restrictions caused by the pandemic. 

The latest data even states that the unemployment rate will increase to 20% this April. Twice higher than the excesses of the 2008 financial crisis.

US Dollar Weakens Ahead of Announcement of FOMC Meeting Results 

The US Dollar Index (DXY) was observed to weaken around 0.4 percent to the range of 99.50 in early European trading today (29/4). Market participants are anxiously waiting for the announcement of the results of the meeting of the US central bank's policy board (FOMC) which will be delivered at dawn (WIB). 

Interest rates and quantitative easing are not expected to change but may highlight the FOMC's evaluation of current economic conditions. A number of different high currencies showed excellent performance in today's trading, such as the Australian Dollar and the New Zealand Dollar. 

Euro and Pound Sterling also rose prestige versus the Greenback. However, analysts are cautious of possible changes following the announcement of the results of the FOMC meeting. "There is no expectation that the Fed will change policy," said Joe Capurso, forex analyst with the Commonwealth Bank of Australia, as reported by Reuters. 

"(However) the market will certainly be very interested in knowing the numbers (economic forecasts) or at least how much in and how long this situation will last qualitatively. " The Federal Reserve is scheduled to deliver the results of the FOMC meeting at 1:00 a.m. WIB, followed by a press conference from FOMC Chairman Jerome Powell. 

The Covid Pandemic 19 Devastated The Global Economy, Even The Safe Haven Currency

The highest monetary policy authority in the United States announced the last cut in interest rates to a record low between 0.0-0.25 percent and launched quantitative easing of more than 2 trillion US dollars. 

"The role of the Fed is to provide the best possible assistance and stability during this limited period of economic activity, and our actions today will help ensure that recovery will eventually take place as quickly as possible," Powell said after the last FOMC meeting. 

The Federal Reserve is one of the central banks with the loosest monetary policies among the G10 countries. The exchange rate remained strong because it was considered a safe haven during the COVID-19 pandemic ransacked the global economy. 

However, the dynamics going forward will be far more favorable for the currencies of any country that has managed to recover faster. Even though the US is now recording the largest number of deaths from COVID-19 in the world and economic activity in various states is still limited by lockdowns.