USD index consolidates around 99.50 ahead of FOMC minutes

Wednesday, November 18, 2015

The US Federal Reserve publishes minutes from its latest FOMC meeting this evening. At the last meeting, the US Fed reported that the current 0% to 0.25% interest rate target “remains appropriate”. The next Fed meeting is scheduled for 15-16th December 2015. The US dollar index hit a high yesterday at 99.745 despite the recent disappointing US economic data. However, this morning the USD index slid slightly lower in early trade and hovered around 99.50 against a basket of currencies.

USD index

DXY Curncy (DOLLAR INDEX SPOT)   2015-11-18 08-59-26 

European equity markets gave back yesterday’s solid gains and reversed to slide lower in early trade this morning. The DAX, CAC, IBEX and London equity benchmark indices retreated between 0.40% and 0.75% as investors remain cautious regarding the current tensions across the European countries. Asian equity markets were mixed overnight. The Nikkei index edged slightly higher and added 0.15% towards 19,650, while the Hang Seng index reversed from yesterday’s gains and slid lower (-0.35%) towards 22,150.

The euro has largely consolidated around 1.0650 against the dollar, showing signs of fatigue. The European currency continues to hold immediate key support around 1.0600, while today the main focus will turn to the release of the Eurozone’s construction output data for September. The Greek government and its European negotiators reached a tentative agreement yesterday, which secures the release of 2 bln euro in aid and the restructuring of the Greek banks. The tentative agreement is expected to be finalised tomorrow when the Greek authorities pass all the legislation required.   

Barclays faced a new US fine of at least $100 mln from the US Department of Financial Services due to renewed allegations that the bank abused foreign exchange markets through its electronic platform. Barclays’ share remained under pressure and retreated over 0.70% in early trade this morning.

EURUSD

EURUSD Curncy (EUR-USD X-RATE)   2015-11-18 08-59-40

 

Events for today:

1000

EZ

Sep

Construction Output

1330

US

Oct

Housing Starts

1330

US

Oct

Building Permits

1530

US

w/e

EIA Energy Stocks

1900

US

Oct

FOMC minutes

 

All times UK Local Time

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