Dollar Dips Ahead Of Fed Announcement

The dollar is down slightly against all of its major rivals Tuesday afternoon. Traders are awaiting the outcome of the Federal Reserve’s 2-day policy meeting, which began this morning. The meeting is the last under the leadership of Fed Chair Janet Yellen as Jerome Powell takes over the helm in February.

The Fed is widely expected to maintain its interest rate at the meeting.

Consumer confidence in the U.S. rebounded by more than expected in the month of January, according to a report released by the Conference Board on Tuesday. The Conference Board said its consumer confidence index climbed to 125.4 in January from an upwardly revised 123.1 in December.

Economists had expected the consumer confidence index to rise to 123.6 from the 122.1 originally reported for the previous month.

The dollar dropped to a low of $1.2453 against the Euro Tuesday, but has since bounced back to around $1.24.

Eurozone economy grew at the fastest pace in a decade in 2017, outpacing many advanced economies.

Gross domestic product expanded 2.5 percent in 2017, which was the fastest since 2007, when it grew 3 percent, Eurostat reported Tuesday.

In the fourth quarter, GDP expanded 0.6 percent sequentially, slightly slower than the 0.7 percent increase seen in the third quarter, preliminary flash estimate showed.

Eurozone economic sentiment moderated from a 17-year high in January, survey results from European Commission revealed Tuesday. The economic confidence index dropped unexpectedly to 114.7 in January from revised 115.3 in December. The score was forecast to rise to 116.2.

Germany headline inflation slowed for a second straight month in January, defying expectations for stability, as prices fell from the previous month, led by the sharp easing in energy inflation. The consumer price index rose 1.6 percent year-on-year after 1.7 percent increase in December, preliminary data from Destatis showed Tuesday. Economists had expected the rate to remain steady.

France’s economic growth accelerated slightly in the fourth quarter, preliminary data from the statistical office Insee showed Tuesday. Gross domestic product climbed 0.6 percent sequentially, slightly faster than the revised 0.5 percent expansion seen a quarter ago.

French consumer spending declined in December after a sharp rebound in the previous month, figures from the statistical office INSEE showed Tuesday. Consumer spending dropped 1.2 percent month-over-month in December, reversing a 3.0 percent increase in November.

The buck rose to an early high of $1.3978 against the pound sterling Tuesday, but has since retreated to around $1.4150.

UK mortgage approvals declined in December, figures from the Bank of England showed Tuesday. The number of mortgage approvals fell to 61,039 in December from 64,712 in the previous month. This was the lowest since January 2015 and also below the expected level of 63,500.

The greenback reached a high of Y109.204 against the Japanese Yen Tuesday morning, but has since pulled back to around Y108.775.

The average of household spending in Japan was down 0.1 percent on year in December, the Ministry of Internal Affairs and Communications said on Tuesday, coming in at 322,157 yen. That was shy of expectations for an increase of 1.3 percent following the 1.7 percent gain in November.

The unemployment rate in Japan came in at a seasonally adjusted 2.8 percent in December, the Ministry of Internal Affairs and Communications said on Tuesday. That was above expectations for 2.7 percent, which would have been unchanged.

Retail sales in Japan were up a seasonally adjusted 0.9 percent on month in December, the Ministry of Economy, Trade and Industry said on Tuesday. That beat forecasts for a decline of 0.4 percent following the 1.8 percent gain in November.

The material has been provided by InstaForex Company – www.instaforex.com