Last night’s FOMC statement offered no surprises and no there was no change to interest rates.
There was no firm date on the balance sheet unwind. However, the policy statement did indicate the run-off will begin “relatively soon,” versus this year in the June statement, which is basically what Chair Yellen said at her latest testimony. The decision was unanimous too with no dissenters. There was also one important change versus the June statement; the elimination of word “recently,” referring to the decline in inflation, suggesting there’s some concern the weakening will be more long lasting rather than the assumption it was only temporary. The statement referred to jobs growth as “solid”.
This was a RISK ON trigger for Bonds, Stocks and Commodities. USD fell again and exceptions of a December rate hike dropped as low as 40%, they were 50/50 before the statement. The USDIndex dipped below 93.00 (a two year low) and EURUSD broke 1.1750 (two year high).
Gold triggered a long position on the breach of 1250 (t1 1265, t2 1275 and sl $1236). The AUDCHF short position was stopped out for -82 pip loss. Following yesterday’s successful 47 pip short on the GBPAUD H4, the Daily reversal and did not trigger. USOil holds $48.60 after profit takers moved in at $48.70 following a strong week and the big inventory draw-down yesterday.
Click here to access the HotForex Economic calendar.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! The next webinar will start in:
Senior Market Analyst
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.