The post FOMC USD selloff continues to be the main theme as the USD index has hit a 30-day low at 100.17. The Federal Reserve on Wednesday, raised interest rates by 0.25% to a target range of 0.75% to 1% but kept its previous forecast of three rate increases this year unchanged, which disappointed investors, who expected four rate hikes in 2017.
EURUSD hit a new 1 month high this morning at 1.0781 after Ewald Nowotny, member of the ECB mentioned that a rate hike from the ECB could be in the cards in the near future and affirmed that the rate hikes could be done in a different manner from the FED. EURUSD trades at 1.0750 now. Demand for EUR also increased after far-right leader Geert Wilders was defeated in the Dutch parliamentary elections.
GBPUSD also marched higher, extending its recovery from last week’s low of 1.21 to 1.2376 highs. The Pound benefited from the fact that one member of BoE voted for a rate hike this month. The BoE made no policy changes and reiterated its neutral stance by repeating it could move ‘in either direction’.
GOLD and Silver which have benefited by the USD weakness, continue to trade at their latest highs. GOLD reached $1233 highs yesterday, before stabilizing at $1226 at time of writing, while Silver rose to $17.54
Today’s news events include US Industrial Production as well as Consumer Confidence data. Both are of medium importance given that the market will most likely focus on inflation data and employment going forward
Source: Easy Forex Forex.Info