Greenback strikes a two-year high as Fed......>

FOREX: Greenback strikes a two-year high as Fed delivers hawkish cut

-The Fed followed through Wednesday, cutting the Fed funds rate by 25bps and

bringing an end to quantitative tightening two months early. The net effect of

the decision was to send the greenback higher, with Powell's press conference

making it relatively clear that the FOMC don't see this rate cut as the first of

many. Powell spoke up for the FOMC's willingness to support the current economic

expansion, although both Rosengren and George dissented from the decision.

-Markets responded by boosting the greenback to the highest levels on an index

basis since mid-2017 as the US yield curve flattened at the expense of the

short-end. The USD strength was most notably felt against high beta FX, with

AUD, NOK and SEK falling most sharply. The bounce pressed AUD/USD to close lower

for its ninth consecutive session, with the market finding support at the

mid-June $0.6832 low.

-Focus turns to UK Manufacturing PMI, the Bank of England rate decision and

inflation report as well as weekly US jobless claims and July's Manufacturing

ISM data.