There weren’t any significant movements on the currency market on Tuesday. The US dollar index closed slightly down, moving from 91.77 to 91.56, despite some positive data on the housing market. Building permits increased by 5.7% month on month in August. The euro index closed in positive territory, edging up from 95.09 to 95.35. The euro also continued its growth against the British pound, Japanese yen, and Swiss franc.
The New Zealand dollar got a boost yesterday from a rise in their GTD index, which was published at 17:33 (GMT+3). The GTD came out 0.9% up on the previous reading.
Today, at 2:50 (GMT+3), the Bank of Japan published its trade balance report. Imports and exports in Japan rose by 1.2% in August compared to July, with a positive balance of 367.31bn JPY. As such, the country of the rising sun continues its stable growth in export trading. GDP growth in Japan in 2017 will come to around 1.4% – 1.8%.
Day’s news (GMT+3):
- 11:30 UK: retail sales (Aug).
- 16:00 Switzerland: SNB quarterly bulletin.
- 17:00 USA: existing home sales (Aug).
- 21:00 USA: Fed interest rate decision.
- 21:30 USA: FOMC press conference.
It’s unlikely that the Fed will announce a rate hike this evening, although Forex market volatility could increase significantly during the FOMC’s press conference. I suggest that anyone trading currency pairs involving the US dollar should do so with particular caution.
In my opinion, it would be better for the US economy if the Fed decided to maintain the key rate at its current level of 1.00% – 1.25% as well as to tone down its rhetoric on monetary policy. In such an event, the dollar could receive some psychological support and partially recover its losses against the euro, British pound, Swiss franc, and so on, in October and November.
EUR/USD
On the 4-hour timeframe, the EURUSD currency pair is continuing its upwards trend:
On the hourly timeframe, the EURUSD is trying to renew the “key top†of the correctional movement, which is located at 1.1990:
