Strong USD on Tuesday
The main market tendency today is that the US dollar is rising against its major peers and riskier assets such as stocks and oil are plummeting.
What to expect from FOMC?
What to expect from FOMC?
Instruments to trade: EUR/USD, EUR/GBP, EUR/JPY
This Wednesday the FOMC will give economic projections, which will have a huge impact on the Forex market. The report usually consists of Fed’s decision on interest rates and other policy measures. The Fed has already signaled that it won’t raise interest rates any time soon. In addition, it should further pump more money into the economy through its bond-buying program and ultra-cheap loans to banks. Besides, analysts expect that the central bank will emphasize downside risks amid the rising virus cases in the USA and press on Congress to act by increasing the spending. As a result, traders will expect further easing, which will drive the US dollar down. However, there is still a tiny chance that the Fed will deliver optimistic projections.
- If the Fed’s outlook is upbeat, the USD may rise.
- If the Fed’s outlook is downbeat, the USD may fall.
Similar
Will the USD grow with the US labor market?
The US unemployment claims are out on Thursday at 15:30 MT time.
Will the US CPI boost the USD?
The American CPI is announced on Wednesday at 15:30 MT time.
Latest news
ECB report is in focus
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Markets await Biden to unveil "trillions dollars"
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
USD came under selling pressure
The US dollar’s weakness offered a boost to emerging-market currencies and oil.
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