Markets somewhat calmer ahead of the Fed -....>

FOREX: Markets somewhat calmer ahead of the Fed

- Equity markets dropped sharply across Asia-Pac, with Hong Kong's Hang Seng

down just shy of 3% at the close as Coronavirus fears persisted into another

session. The picture is somewhat calmer in Europe, however, with equities a

touch higher after the better Wall Street finish. The JPY is holding firm, but

it is yet to trouble the best levels of the Tuesday session, as focus turns to

today's FOMC decision. The Fed are seen keeping policy unchanged, with focus on

any comments about the balance sheet and whether their bill-buying ops are

merely technical or are providing monetary stimulus.

- EUR was offered throughout the European morning, prompting EUR/USD to hit a

new low down at $1.0995. The losses may be being stemmed, however, by month-end

FX rebalancing efforts, which continue to point toward USD sales against both

the EUR and JPY.

- The FOMC decision takes focus going forward, with the rate decision due at

1900GMT/1400ET and the press conference with Fed chair Powell half an hour

later.