Janet Yellen and company will be making an announcement tomorrow in regards to interest rates and whether they will raise them. Back in September, the Fed did not expect oil prices and unemployment to be where they are currently. It’s no secret that oil prices have risen dramatically in recent weeks and that unemployment is at its lowest level in nearly 10 years.
With that being said, the Fed has some serious thinking to do in regards to interest rates. The question at hand, is, will interest rates hike sooner than we think, or will Yellen and the Fed take a step back and wait to see what else unfolds before taking any definite action?
- Note: The dollar typically strengthens when expectations for Fed interest rate increases rise, as dollar assets become more attractive to yield-seeking investors.
- Note: The rise in crude oil prices has gone hand-in-hand with inflation increase expectations in recent weeks.
- Keep in mind that oil prices typically have an inverse relationship with the U.S. Dollar Index.
As of 11:30 am, Heating oil is currently up 8 points, Rbob is up 47 points, while WTI Crude is down 13 cents.