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3 ways that the Fed could go:
1. refrain from taking further measures for now, once again saying that it stands ready to act if needed. This is the worst option for equities.
2. Fed could extend Operation Twist. This would be better than doing nothing, but it is unlikely to lead to a sustained rally in equities or other risk assets
3. FOMC could announce a full-blown, brand new programme of Large Scale Asset Purchases. This is what the market is hoping for, and this is also what equity investors have been pricing in recently.
http://www.fx360.com/commentary/david/7833/us-preopen-call.aspx
Despite this speculation there remains a political dynamic with respect to further Fed intervention in an election year, which could make any further substantial easing politically problematic for the Fed, given fierce Republican criticism of the policy a year ago.
http://www.cmcmarkets.co.uk/blog/posts/currency/markets-looking-fed-placebo
The election result looked likely to yield a coalition government led by conservative New Democracy but leaves an emboldened SYRIZA bloc to rally angry opposition in the streets to the punishing terms of the bailout
http://uk.reuters.com/article/2012/06/17/uk-greece-election-idUKBRE85F05520120617
Bearish news for EURO
http://uk.reuters.com/article/2012/06/17/uk-france-election-idUKBRE85F0NP20120617
