Dollar lower on expectations of dovish Fed today
"There is nothing so powerful as truth - and often nothing so strange. "
September 16, 2020
EUR/USD 1.1852 GBP/USD 1.2968 USD/CAD 1.3183 AUD/USD 0.7326 USD/JPY 104.95 USD/CNH 6.7558 USD/ILS 3.4205 USD/MXN 21.0950 USD/CHF 0.9070 USD/INR 73.5250
Investors are focused on Fed Chairman Powell’s actions and comments this afternoon. The central bank is expected to leave interest rates unchanged and the “dot plot” is expected to show near zero rates through 2023. Markets are hoping they remain accommodative and are listening for comments on the bond buying program and long term plans with the Fed's balance sheet. August retail sales came in less than expected weighing on the greenback. House Speaker Pelosi commented that the October recess may be postponed until a bipartisan agreement can be announced on a new relief bill.GBP
The UK pound led G-10 gainers helped by speculative demand ahead of US Fed meeting and renewed Brexit optimism. Reports indicate PM Johnson is willing to compromise on the bill that previously overrode initial elements of the withdraw agreement.EUR
The euro stayed stronger versus the USD as the dollar remains under pressure ahead of Fed policy decision.CAD
The Canadian dollar strengthened slightly on dollar weakness. Oil prices are on the rise again as Hurricane Sally disrupts US oil supply and API showed a drop in US stockpiles.ASIA/PACIFIC
The yen improved as much as half a percent versus the dollar to the lowest level since July 31. Importer and investor demand is expected to support the movement below 105.00.
The Chinese yuan also extended gains on market optimism and resilience of long term prospects of the Chinese economy.
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