Yellen Becoming More HawkishThursday February 16, 2017 08:29
(Kitco News) - Janet Yellen’s more hawkish tone at the Senate banking committee yesterday pushed the dollar higher and gold sold off. Yellen expressed concern that the Fed may be behind the curve on inflation and suggested the Fed may move sooner rather than later on rate hikes. Between the lines, Yellen hasn’t changed her tone, but the insertion into her comments that going forward all Fed meetings were to be considered live was a departure from past Fed action. In the past, Fed action coincided with meetings where a press conference was on tap to allow for dialogue on why an action was taken. Going forward, surprises may be the new paradigm. It remains a low probability that the Fed will move in March, unless a clear fiscal policy is outlined by the Trump administration. Trump has announced that a major announcement on tax reform is close, which will give the markets some meat to analyze ahead of the March meeting. Today’s US CPI number will influence direction. Support as at $1,220, with resistance remaining at the $1,237 level.