Forex Today: Dollar Firm Ahead of FOMC Announcement

Adam Lemon

The US dollar is quietly bullish ahead of today’s expected announcement by the FOMC that its QE program will begin to be reduced.

  • The FOMC statement release tonight is widely expected to include an announcement of the beginning of tapering QE. This is a major policy change which has already been “priced in” but will shift monetary policy in a less dovish/accommodative direction. Despite the threat to the support of QE to capital markets, US stocks continue to rise buoyantly to new all-time high prices. It is likely we will see higher prices in the NASDAQ 100 and S&P 500 Indices over the coming days.

  • The Forex market is a little restrained, with the USD quietly bullish ahead of the FOMC meeting later today. The USD is the strongest currency right now, while the CAD is the weakest, caused partly by the fact the price of crude oil is beginning to decline from its recent peak.

  • The ADP non-farm payrolls forecast and the US ISM Services PMI data will be released later today, but are unlikely to affect the USD much as the market will be so focused on the upcoming FOMC statement and press conference.

  • New Zealand employment data came in much more strongly than had been expected, with the new unemployment rate at only 3.4% compared to the 3.9% which had been forecast. This suggests New Zealand’s economy is booming, but the data had little effect on the NZD.

  • Last week saw the second consecutive global weekly rise in new confirmed coronavirus cases after two months in which cases fell steadily.

  • It is estimated that 49.6% of the world’s population has received at least one dose of a coronavirus vaccination.

  • Total confirmed new coronavirus cases worldwide stand at over 248.2 million with an average case fatality rate of 2.03%.

  • The rate of new coronavirus infections appears to now be increasing most quickly in Austria, Barbados, Bulgaria, Chile, Croatia, the Czech Republic, Denmark, Egypt, Estonia, Germany, Greece, Hungary, Iceland, South Korea, Laos, Lithuania, Montenegro, Netherlands, New Zealand, Norway, Poland, Russia, Singapore, Slovakia, Slovenia, and the Ukraine.

Adam Lemon

Adam Lemon began his role at DailyForex in 2013 when he was brought in as an in-house Chief Analyst. Adam trades Forex, stocks and other instruments in his own account. Adam believes that it is very possible for retail traders/investors to secure a positive return over time provided they limit their risks, follow trends, and persevere through short-term losing streaks – provided only reputable brokerages are used. He has previously worked within financial markets over a 12-year period, including 6 years with Merrill Lynch.
Learn more from Adam in his free lessons at FX Academy

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.