The Fed has left the dollar vulnerable
28.01.2016
The main currency pair weakened the night before, but in the afternoon on Thursday returned to a narrow trading range.
On Thursday the euro/dollar is trading reservedly - investors continue to evaluate the results of the two-day meeting of the US Federal Reserve, which ended yesterday, the first in the New Year. The current quotation of the instrument is 1.0875.
Thus, the Fed kept the interest rate in the previous target range of 0.25-0.50% per annum, the last time it was revised in December 2015, after the first phase of a multi-year lull. So, the decision was expected - the time of the revision was too short for the economy to feel any noticeable effect. The Fed accompanying statement was quite mild, although the regulator has promised to raise rates further.
Of course, this market is too small to form a medium-term portfolio with the expectation of a rate hike sometime in the future. That is why the dollar remained without support.
Yesterday interesting statistics were published by the United States, which in general remained in the shadow of the Fed meeting. Sales of new homes in December were up 10.8% y/y, to a level of 544 thousand with the forecast to increase up to 500 thousand. New buildings are in demand: in December alone, sales increased by 9.9% m / m, which gave momentum to the main Annual indicator. The average price of homes fell by almost 3%, which likely led to the increased interest.
Today's macroeconomic calendar is full of reports. US will release data on orders for durable goods, and will present a weekly report on the number of claims for unemployment benefits and the number of outstanding transactions for the housing market. We are interested in the release of the first two - both are very informative and can support the USD.
RoboForex Analytical Department
On Thursday the euro/dollar is trading reservedly - investors continue to evaluate the results of the two-day meeting of the US Federal Reserve, which ended yesterday, the first in the New Year. The current quotation of the instrument is 1.0875.
Thus, the Fed kept the interest rate in the previous target range of 0.25-0.50% per annum, the last time it was revised in December 2015, after the first phase of a multi-year lull. So, the decision was expected - the time of the revision was too short for the economy to feel any noticeable effect. The Fed accompanying statement was quite mild, although the regulator has promised to raise rates further.
Of course, this market is too small to form a medium-term portfolio with the expectation of a rate hike sometime in the future. That is why the dollar remained without support.
Yesterday interesting statistics were published by the United States, which in general remained in the shadow of the Fed meeting. Sales of new homes in December were up 10.8% y/y, to a level of 544 thousand with the forecast to increase up to 500 thousand. New buildings are in demand: in December alone, sales increased by 9.9% m / m, which gave momentum to the main Annual indicator. The average price of homes fell by almost 3%, which likely led to the increased interest.
Today's macroeconomic calendar is full of reports. US will release data on orders for durable goods, and will present a weekly report on the number of claims for unemployment benefits and the number of outstanding transactions for the housing market. We are interested in the release of the first two - both are very informative and can support the USD.
RoboForex Analytical Department
Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.