News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Bearish
Oil - US Crude
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
More View more
Real Time News
  • While the US Dollar has been holding its ground, its downside bias against the Singapore Dollar, New Taiwan Dollar Thai Baht and Indonesian Rupiah remains intact as it hovers at support. Get your market update from @ddubrovskyFX here: https://t.co/p7gAztWuVG https://t.co/zB1pOS6U4D
  • The $VIX is now running 227 trading days above the 20 handle. It is also working its way quickly into a dead-end descending triangle. These don't really break lower... https://t.co/39Pr7YrQ08
  • WTI Crude amongst the many market participants taking a hit today, down almost 3% $WTI $USD https://t.co/eg2phm1wUO
  • The power of suggestion: even though the market recognized the mistake with mixing Tesla founder Musk's suggestion to use the Signal app with the stock SIGL, it is still trading >2,000% above pre-remark levels and maintains heavy volume. Us speculators are an interesting people
  • Forex Update: As of 21:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: -0.07% 🇨🇭CHF: -0.35% 🇪🇺EUR: -0.65% 🇨🇦CAD: -0.75% 🇦🇺AUD: -0.95% 🇳🇿NZD: -1.19% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/6NZVebT00L
  • one final $BTCUSD chart ahead of the weekend bc I think this is going to remain on the move. 35k support has held for now, but prices are testing a big zone of prior resistance (same that held the high on tues morning). break down/out levels in purple below $BTC #Bitcoin https://t.co/TeLrBYJXty https://t.co/MewVjXNrRT
  • Silver selling off during trade, now down over 3% $XAG $USD https://t.co/V69rLJMYcC
  • Commodities Update: As of 21:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -0.51% Gold: -1.05% Silver: -3.13% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/8iVg3kAOtv
  • Get your snapshot update of the of relative currency strength and exchange status from around the globe here: https://t.co/H19vRDCpUJ https://t.co/u1zneUg7cE
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.77%, while traders in NZD/USD are at opposite extremes with 67.96%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/IbD24BlleG
US Dollar Drops as FOMC Turns Hawkish on Inflation, Dovish on Growth

US Dollar Drops as FOMC Turns Hawkish on Inflation, Dovish on Growth

2018-05-02 18:35:00
Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- FOMC holds benchmark interest rate in range of 1.50-1.75%, as was expected by markets.

- Fed funds price in a 100% chance of a 25-bps rate hike in June, but odds for September and December stay in same territory post-release as they did pre-release.

- US Dollar produces mixed reaction, eventually trading lower after a few minutes of initial digestion.

Looking to learn more about how central banks impact FX markets? Check out the DailyFX Trading Guides.

At its May policy meeting today, the Federal Open Market Committee did what was widely expected when they announced the main overnight benchmark rate would stay on hold in the range of 1.50-1.75%. The meeting itself was seen as nothing more than prepping market participants for a 25-bps rate hike next month, when the next Summary of Economic Projections is released.

With that said, there were a few tweaks to the May FOMC policy statement relative to the March one, which in turn suggests the Fed is getting more hawkish on inflation, even as it is getting more dovish on growth.

On inflation, the Fed upgraded its view on prices pressures from “both overall inflation and [core] inflation…have continued to run below 2 percent” to “both overall inflation and [core] inflation…moved close to 2 percent.” Now, “inflation on a 12-month basis is expected to run near the Committee's symmetric 2 percent objective over the medium term.” The phrase “the Committee is monitoring inflation developments closely” was notably absent.

On growth, the key phrase “the economic outlook has strengthened in recent months,” was removed from the May policy statement. As was the case in the March statement, Fed officials believe that “economic activity will expand at a moderate pace in the medium term and labor market conditions will remain strong.” The release of the Q1’18 US GDP report last week showed growth coming in at +2.3% annualized last quarter, now running below the headline CPI rate of +2.4% (y/y).

See the DailyFX economic calendar for Wednesday, May 2, 2018

DXY Index Price Chart: 1-minute Timeframe (May 2, 2018 Intraday)

US Dollar Drops as FOMC Turns Hawkish on Inflation, Dovish on Growth

Immediately following the data, the US Dollar slipped back versus the Euro and the Japanese Yen, with the Dollar Index (DXY) dropping from 92.67 ahead of the FOMC decision to as low as 92.25. The DXY Index was trading at 92.36 at the time this report was written.

Read more: US Dollar Outlook for the May FOMC Meeting

FX TRADING RESOURCES

Whether you are a new or experienced trader, DailyFX has multiple resources available to help you: an indicator for monitoring trader sentiment; quarterly trading forecasts; analytical and educational webinars held daily; trading guides to help you improve trading performance, and even one for those who are new to FX trading.

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher's e-mail distribution list, please fill out this form

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES