FOREXYARD: Forex News Blog | |
- Forex Update: U.S. Interest Rate Decision on Tap Today
- U.S. Durable Goods Orders on Tap
- Fed Funds Rate Release
- USD Forecast – Federal Funds Rate Expectations
| Forex Update: U.S. Interest Rate Decision on Tap Today Posted: 09 Aug 2010 09:30 PM PDT
The US dollar rose against the other major currencies on Monday as investors squared up positions a day ahead of this week’s Federal Reserve monetary policy announcement. Today’s market moving event is going to be the U.S. Federal Reserve Board’s decision on short-term interest rates and is widely expected to leave it at 0-0.25%. Forex traders should prepare for what is shaping up to be a trading week full of opportunity. 12:15 GMT: CAD – Canadian Housing Starts • This indicator reflects the annualized number of new residential building that began construction during the previous month. • This release is expected to be lower than their previous figures. • Disappointing results could send the USD/CAD pair above the 1.0400 resistance level. 18:15 GMT: USD – U.S. Federal Funds Rate • Forecasts show that U.S. interest rates are expected to remain near 0.25% for the foreseeable future. • Heavy volatility is likely to take place at that time of the announcement, however, due to the various speculations attached to the corresponding rate statement. • Traders should focus their attention on this release, as it is expected to be the highlight of the week for American markets; however, the direction of the market's volatility is not yet known and will depend on the statements made following its release. |
| U.S. Durable Goods Orders on Tap Posted: 23 Jun 2010 11:06 PM PDT
Yesterday’s most significant publication was the Federal Funds Rate. This is in fact the U.S. Interest Rates announcement for July. The Fed’s decided to leave rates at a record low, and even pledged to keep the low rates in the near future. This has weakened the Dollar, especially vs. the Euro and the Pound. As a result, crude oil tumbled as well, and a barrel of crude oil is currently trading around $76 a barrel. However, positive U.S. data today might have potential to correct yesterday’s losses. Here are today’s leading news events: • 09:00 GMT, European Industrial New Orders – It’s a leading indicator of production. A positive figure usually signals that manufacturers will increase activity as they work to fill the orders. If the end result will beat expectations for 1.6% rise, the Euro is likely to be supported. • 12:30 GMT, U.S. Core Durable Goods Orders – This indicator measures the change in the total value of new purchase orders placed with manufacturers for durable goods, excluding transportation items. Analysts have forecasted that the Durable Goods Orders rose by 1.1% during May. Such a result has potential to boost the Dollar. • 12:30 GMT, U.S. Unemployment Claims – This report measures the number of individuals who filed for unemployment insurance for the first time during the past week. If the end result will be lower than the expected 461,000 – the Dollar might rise against the majors. |
| Posted: 21 Sep 2009 01:00 PM PDT
This Wednesday we should have the market mover that should be the highlight for this week’s trading; the Fed Funds Rate and the accompanying Federal Open Market Committee Statement (FOMC). With equities and the Euro at their yearly highs, the statement could make or break the bullish streaks. Last week, Federal Reserve Board Chairman Ben Bernanke claimed that the recession had come to an end. Now market participants will attempt to predict the remarks written by the FOMC. The economy has begun to pick up steam from the recessionary period. However, inflation is virtually non existent in the American economy; the committee is widely expected to hold interest rates at their near 0% level. But traders will be attempting to gauge just when the FOMC will begin raising rates to fend off future inflation due to the previous monetary policy moves used to guide the economy through the financial crisis. Just when this monetary policy tightening will be implemented is still up for debate. When this tightening occurs, it could spell bad news for EUR/USD bulls. The currency pair has been tracking equities during the recent rally as the pair has climbed to its yearly high of 1.4766. A sign that the FOMC will begin to tighten rates in an attempt to fend off future inflationary pressures will be a negative for equity markets and as such; a negative for the EUR/USD. |
| USD Forecast – Federal Funds Rate Expectations Posted: 12 Aug 2009 02:56 AM PDT
Today at 18:15 GMT we are awaiting the policy statements from the Federal Open Market Committee (FOMC) of the US Federal Reserve regarding US interest rates and other monetary policy decisions. Anticipating the impact this event can have on the US Dollar is important for active forex traders, especially considering the fact that these interest rate decisions are one of the most important calendar events in the forex market. Make sure your positions are set and ready to ride the tidal wave that may follow! Laid out below are the indicators to watch for in this report. Helping the USD At present, market analysts are forecasting the Federal Funds Rate to be maintained near 0% following the statement issued by the Federal Open Market Committee (FOMC) at 18:15 GMT today. The chatter surrounding a possible rate hike increased after last Friday’s Non-Farm Payroll data, but current growth levels still fall short of justifying a hike to interest rates. On the other hand, growth is taking place at a nominal level and the time is approaching for a rate increase to occur. If today is indeed the day that this takes place, traders will see a wave of bullishness overcome the USD as American investment growth will put upward pressure on the national currency. As this is an unexpected event, traders should simply be on the lookout for hawkish statements from the Fed which could signal an increase to interest rates in the next round of discussions. If we do indeed experience bullishness from this report, a reasonable target for the EUR/USD may be near the 1.4050 level. Hurting the USD As interest rates are being forecast to remain where they are, not much data could put a damper on the USD following this report. However, there is the possibility that the Fed will release a dovish statement signaling that growth is not as strong as anticipated and the US markets may still face downturns before a full recovery is underway. In this turn of events, the USD may begin to react negatively as traders view positive data as a surge in risk appetite, but not a return to US markets. This would mean that the USD could fall to as low as 1.4200 versus the EUR following the FOMC’s statements. |
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