Photo: Photo Illustration by Business Insider
Great roundup of why the FOMC statement and Bernanke’s big speech big speech caused the dollar to get trashed from Citi’s FX analyst Steven Englander.We’ve summarized his six points.
1) The Fed’s comfort zone with respect to inflation is clearly expanding.
2) The Fed still doesn’t buy that it’s responsible for rising commodity prices.
3) Any talk of a stronger dollar was seen as pro forma.
4) Clearly Bernanke is happy with how QE2 has turned out.
5) Bernanke is emphasising that the end of QE is not tightening, because it’s the stock of Fed assets that matters, not the flow.
6) The downgrade to the economy was very tepid. Again, Bernanke thinks QE has worked.
This chart tells the story.