Gold 1751,355
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EURUSD 1,1737
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DJIA 34623,50
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OIL.WTI 73,375
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DAX 15645
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So the Fed meeting is over. Of course, many people were expecting some specific statements from it, but we did not get anything much. Jerome Powell said that he keeps pumping money into the system and thus maintains a favourable atmosphere for economic growth, and very briefly hinted that we will talk about future plans in October, when there will be more stable data on unemployment and inflation after all.
EUR/USD
The dollar is under attack. Not only has the Fed only hinted at a possible announcement of a plan to roll back support only in October, but problems with a possible default are increasing in the USA. Republicans are in no hurry to accept increased limits because of disagreement with Biden’s economic programme. If the congress does not agree on raising the debt ceiling, the Treasury will run out of money in October. That in turn will lead to a suspension of state employees’ salaries and various allowances. Such a situation would definitely put additional pressure on the US economy.
What does all this mean for the currency market? At the moment all central banks continue their programs to support the economy. But the practice shows that when investors start buying risky assets again, the dollar sinks. Because most commodities and stocks are traded in USD.
Therefore now after the meeting EUR/USD has a good opportunity to rise to 1.1820 and then to 1.1890 -1.19 in the medium term. If there are more problems with the sovereign debt ceiling, we could see short-term moves up to 1.1950.
Of course the European Central Bank will be watching the situation closely as Europe does not need an expensive Euro and is likely to make some manoeuvres to mitigate the fluctuations.
01.30 Japan National Consumer Price Index YTD
13.00 IFO business optimism gauge in Germany
16.00 New home sales in the US for August
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