With an hour to go before the FOMC statement, the markets are firmly in neutral. Offers remain above the market from 1.3770 through 1.3800 while bids are eyed on dips to the 1.3730 level.
Expect the Fed to retail its view that inflation is a long way off given resource slack in the economy. If the “extended period” language is removed expect it to be replaced with something like rates will stay low for a “prolonged interval”.
