Rising bond yields and upcoming Fed meeting

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S&P 500, daily chart.

The Federal Reserve will hold a meeting with the Congress on February 23 and 24. Many are anticipating this event because according to the latest reports, US bond yields have risen to much higher levels than expected. This could mean that investors are ready for a new wave of market growth, or it may be an indication that inflation is now increasing. In such a case, the Fed might tweak its monetary policy in order to control the rate of inflation. If this happens, the position of the US dollar will certainly weaken in the market.

But in the meantime, the Fed's policy is still the same. It will remain soft until inflation reaches above 2.5%

In another note, on Thursday, the US will release updated data on employment, which, a week ago was quite weak and disappointing.

The material has been provided by InstaForex Company - www.instaforex.com

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