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USD Firms Pre-Fed and Powell Says Little to Soften the Blow

FOREX

The greenback out-traded all others Wednesday, with the bulk of the move coming ahead of the Fed rate decision. Another ECB sources story added weight to EUR/USD, with Bloomberg reporting that the ECB are agreed on pushing back against market expectations that the bank will not cut key interest rates further. The headlines added extra weight to the EUR, which slipped to 1.2059 and in close proximity to the 2021 low at 1.2054.

The Fed decision was unchanged - as expected - and despite Powell stressing that any talk of policy exit at present is premature, the USD remained strong and equities suffered. This worked against growth proxy currencies, with AUD, NZD and NOK all slipping.

Focus Thursday turns to weekly jobless claims numbers, regional German CPIs and the advance reading of Q4 US GDP. ECB's Schnabel is due to speak.

MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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