Tuesday September 20, 2005 - 05:15:54 GMT
Share This Story
Tricom Futures and Foreign Exchange -
Forex: FOMC Day - Will this be Greenspan's last hike??
The US dollar was slightly lower against major currencies, trading in a tight range as investors awaited the outcome of tonight's Federal Open Market Committee meeting in the US. As the market has largely priced in a 25 basis point rate hike at the FOMC meeting, investors are more likely to be focused on the FOMC statement and any clues it may contain on the likelihood, or otherwise, of a continuation of the Fed's current cycle of modest rate hikes.
Overnight, gasoline prices jumped 14 pct and heating oil gained 11 pct in the US, as concerns emerged that Tropical Storm Rita could be upgraded to a hurricane and move into the Gulf of Mexico.
The euro recovered some lost ground against the dollar due to technical-driven adjustments ahead of the FOMC meeting, but the beleaguered currency is expected to remain under pressure in the near term due to the uncertainty created by Germany's inconclusive general election last weekend.
Well here it is, that time of the month again. As we said above, the market's priced in the 25bps hike, but the focus will be on the statement. Will the Fed remove the "measured" phrase, will it signal an end to the current cycle of rate rises, or will it suggest it is going to take a break for the remainder of the year, and assess the effects of the previous rate rises, and the aftermath of hurricane Katrina. Also, with Greenspan retiring in early 2006, i'm sure he doesn't want to be remembered as the Governor who put the US economy into a deep recession, caused by aggressive rate hikes.
In my humble opinion, i think we'll get a 25bps hike, with no change in the statement - i'd be surprised if Greenspan did anything out of the ordinary.
Today’s Economic Releases:
US: Housing Starts
Today’s Top Trades
. Buy EUR/USD around 1.2130-40
· Buy AUD/NZD around 1.0880
For more ideas send me an email, email@example.com
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."