Dollar lower on expectations of dovish Fed today

Dollar lower on expectations of dovish Fed today

Markets await Fed comments this afternoon following the FOMC meeting for signs of a change in the Fed’s stance on the future of the American economy regarding long term zero-rates, Fed balance sheet and inflation targets. The dollar is lagging behind G-10 peers ahead of the conference. The pound led gainers versus the greenback bolstered by renewed Brexit optimism.

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  • FX Rates
    September 16, 2020

    Rates are not real time. Rates are today's indicative mid-market rates as of time of publishing, which may vary. Please contact SVB for a current quote.

  • USD

    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.


    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.  


    The euro stayed stronger versus the USD as the dollar remains under pressure ahead of Fed policy decision.


    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.


    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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Kathryn Garvey
Kathryn Garvey

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