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How useful is the Beige Book?
how useful is it? i think it's just a compilation of comments made by different fed districts, can it really be used by trades to get a bigger picture of the economy?
over 2 years ago
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It is just another set of information that the FOMC use when making the determination of whether or not to raise or lower interest rates. As for its inpact on day to day trading of the Forex, little to no impact at all in 10 years of trading Forex.Peace
over 2 years ago
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Answers (1)
The Beige Book gives a summary of economic conditions around the United States compiled for the Federal Reserve Board. Each Federal Reserve Bank gathers anecdotal information on current economic condition in its District through reports from Bank and Branch directors and interviews with key businessmen, economists, market experts, and other sources.
The Fed uses this report, along with other indicators, to determine interest rate policy at FOMC meetings. The Beige Book is considered a valuable tool, acting in essence as a general gauge on the overall strength of the economy, it is even considered that occasionally it can have the power to shift market reactions if the findings represent a significant enough deviation from current analyst expectations.
Some parts of the book, however, are usually reported earlier. Hence, its publication sometimes has a muted impact on the currency valuations over the short term.
over 2 years ago
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