The increase in financial liquidity after the pandemic has weakened the traditional correlation between economic indicators and the business cycle.

Looking at the forecasts, there is clearly a hawkish tilt. While two members voted for no change today, six members felt the "appropriate" rate should be 3.875% – not the 3.625% central range we are now at.

The US Dollar Index (DXY) reversed two daily gains in a row and collapsed to multi-week lows in the 98.60-98.50 band amid declining yields following the FOMC event on Wednesday.