EUR nears multi-year high on Fed support -....>

FOREX: EUR nears multi-year high on Fed support

- While the Fed declined to commit to yield curve control or a new forward

guidance regime, Powell's reassurance that the Fed will use all tools available

until the "work is done" on the jobs market helped support risk assets and keep

a lid on the USD.

- Markets responded by selling the USD aggressively, prompting new multi-month

lows for the USD index and a show above $1.1384 resistance for EUR/USD, which

narrowed the gap further with the multi-year highs printed in March. The initial

wave of USD sales quickly faded, however, returning most major pairs to the

pre-Fed levels.

- Despite the reassurance from the Fed, safe haven FX failed to take any

material dent, leaving CHF and JPY much stronger on the day. As a result,

USD/JPY briefly showed below the Y107 handle for the first time since mid-May.

This leaves Y106.90 as the next level of support.

- US PPI and weekly jobless claims numbers are the only real highlights

Thursday.