By Debbie Carlson
August 1, 2012
The main event for financial and commodity markets on Wednesday is the outcome of the Federal Open Market Committee. The announcement is expected around 2:15 p.m. EDT. The majority of market watchers expect the Fed to not announce any policy changes, but possibly change their language to hint at some sort of stimulus or a third round of quantitative easing. There is some debate on how that might affect markets. Some analysts, like those at Barclays Capital, say if the Fed stands pat, then it will be supportive to the U.S. dollar. If the dollar rises, then that could put pressure on all commodities including gold. Yet analysts at BNP Paribas say if Fed hints at stimulus down the road, the U.S. dollar could fall in anticipation of possible QE3. A weaker dollar would support gold. Either way, analysts urge market participants to be cautious ahead of the Fed meeting.