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- The greenback was trading marginally higher heading into the FOMC announcement. The initial reaction to the statement was a spike higher in the dollar of around 25 pips as the Fed recognised the economy has made progress on taper goals.
- Initial hawkish tweaks/optimism were sold into immediately with the dollar index trading back to unchanged and then into negative territory in anticipation of Chair Powell's press conference.
- Comments relating to the labour market having 'a way to go' in the recovery kept the dollar on the backfoot for the remainder of the press conference.
- EURUSD traded through both daily extremes, initially breaching session lows through 1.1780 before retracing to the best levels since last week's ECB press conference above 1.1840. As the press conference ended, EURUSD was on the highs of the day at 1.1843 (+0.22%).
- Overall, ranges were somewhat subdued, with the most notable moves seen in CAD and CNH, both recovering around 0.6% after yesterday's sell-off. USDCNH back below yesterday's touted resistance at 6.50 may be technically significant.
- NOK also posted a strong recovery from yesterday and was a stand out performer on Wednesday, with USDNOK down 0.83%.
- Thursday's docket will feature German CPI and Unemployment before the ECB will publish the Monetary Policy Meeting Accounts. Tomorrow's headline data will undoubtedly be the first release of second quarter U.S. GDP, expected to rise to 8.5% Q/q.