The Federal Reserve lifted its assessment of the US economy despite leaving interest rates unchanged. Markets responded. The US dollar rose, shares edged higher and industrial commodities firmed. Futures markets indicate modest gains across the Asia Pacific region today.

The statement accompanying the Fed decision drove the market moves. In central bank speak the substitution of “solid” for “moderate” in describing growth is a leap. Interest rate traders are now pricing a 92% probability of a December rate hike and the US dollar headed back towards three month highs. Share market gains were tepid and narrow in breadth, with the 30 stock Dow beating the broader S&P 500 and Nasdaq 100 indices.

Australian investors have plenty to digest. The NAB announced a hugely improved half year profit of $5.29 billion, made possible by a substantially cleaner balance sheet. Enthusiasm may be tempered by an increase in bad and doubtful debts, a contracting net interest margin and underlying growth around 2.7%. Building approvals numbers today are expected to show a 1% decline, potentially adding to pressure on retailers tied to the housing cycle such as Harvey Norman and JB HiFi.

Volumes across the region may be affected by coming events. A new tax policy and potentially a new Fed chair will be announced in the US tonight, ahead of tomorrow night’s non-farm payrolls release. Closer to home traders will look to tomorrow’s Caixin PMI data as a guide to growth prospects in China and the broader region.