Pound and Yen most sensitive to Fed surprise rate move

Janet-Yellen-Fed-700x450.jpgThe UK pound and Japanese Yen are two currencies that are most sensitive to any surprise policy announcement by the Federal Reserve, as all eyes turn to Janet Yellen’s Jackson Hole speech this week.

Fed chairwoman Yellen is appearing in Jackson Hole, Wyoming this week to speak about the US economy, giving markets a hint at the path of any future interest rate hikes.

However, data from Goldman Sachs how found that the UK pound, Japanese yen and New Zealand dollar are most sensitive to any changes, or perceived changes, in policy, reports the Financial Times.

The euro, on the other hand, is among the least sensitive to Fed rate moves, with the Goldman analysis showing the currency’s sensitivity to US policy changes has reduced recently.

The Swiss franc and Swedish krona are also less sensitive to Fed moves.

Goldman Sachs compared how the currency reacted to changes in the two-year sovereign bonds of the countries in question.