A pause in interest-rate cuts by Federal Reserve ready to lift US Dollar and bearish for precious metals
Teddy Carlos
Apr. 19, 2008

The Federal Reserve is ready to pause on its interest cuts. Fed is sensing both renewed inflation dangers and a possible economic boost from government rebate checks, may be nearing a pause in interest-rate cuts after the fastest reductions in two decades.

Fed Governor Kevin Warsh, San Francisco Fed President Janet Yellen and three other district- bank presidents voiced concerns about rising prices. These are clear indication of a changing trend.

According to many interest rate and Fed watchers, Fed will stop for the rest of the year after a half-point reduction to 1.75 percent this month. The market is already predicting the chance of a quarter-point move instead of the half-point reduction.

The trend is clearly bullish for US Dollar which is severely undervalued. It is also equally bearish for Gold and other precious metals.

US Dollar will also get boost from lowering trade deficit and improving US balance of payments.

A pause in interest-rate cuts by Federal Reserve ready to lift US Dollar and bearish for precious metals
Teddy Carlos
According to many interest rate and Fed watchers, Fed will stop for the rest of the year after a half-point reduction to 1.75 percent this month. The market is already predicting the chance of a quarter-point move instead of the half-point reduction.
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