US Dollar May Struggle to Capitalize on Confident FOMC Stance

Talking Points:

  • US Dollar competence onslaught to gain notwithstanding assured FOMC viewpoint
  • Aussie Dollar drops on CPI miss, NZ Dollar gains before Fed meeting
  • What will expostulate longer-term FX marketplace trends? See a forecasts here

The Australian Dollar fell as disappointing second-quarter CPI data pushed behind opposite RBA rate travel speculation. Central bank Governor Philip Lowe echoed a dovish perspective summarized by his emissary Guy Debelle final week as expected, compounding offered pressure.

The New Zealand Dollar advanced, relocating inversely of retreating front-end US Treasury bond yields. The pierce looks visual after US borrowing costs rose yesterday while a supposed Kiwi weakened. Seesaw sensitivity seems to simulate shake in yield-seeking collateral flows forward of a Fed process announcement.

Officials are approaching to leave a banking process brew in place and substantially won’t offer serve clarity on skeleton to trim a executive bank’s magisterial change sheet. Rhetoric during standard with a FOMC-defined standing quo competence strife with a markets’ some-more dovish perspective however.

Traders see a better-than-even possibility of no serve rate hikes in 2017. By contrast, central Fed forecasts indicate one some-more 25bps boost before a calendar turns to 2018. Officials have struggled to remonstrate a markets on this front, so it is misleading that some-more of a same will boost a US Dollar.

If zero else, an FOMC that sounds assured in a opinion even as acceleration slows competence assistance stop a draining after a greenback slid to hold a 13-month low yesterday. Follow-through competence have to wait for whatever is pronounced to be reliable or countervailed by second-quarter GDP information after in a week.

What do sell traders’ buy/sell decisions contend about FX marketplace trends? Find out here!

Asia Session

US Dollar May Struggle to Capitalize on Confident FOMC Stance

European Session

US Dollar May Struggle to Capitalize on Confident FOMC Stance

** All times listed in GMT. See a full DailyFX mercantile calendar here.

— Written by Ilya Spivak, Currency Strategist for DailyFX.com

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