Back
17 Sep 2013
Dollar under pressure ahead of FOMC meeting, EURUSD continues gains
FXstreet.com (London) - The dollar has come under further selling pressure in the run up to the two-day Federal Open Market Committee (FOMC) meeting that begins today, with further selling from an increased risk appetite following an easing of Syrian tensions.
EUR/USD broke to USD1.3360 as European trading kicked off, continuing a bullish trend that has been in place since 6 September.
The spot Dollar index has declined to 81.2180, from a 6 September high of 82.6300.
Bearish views on the dollar against its majors have been entrenched this week by the departure of Larry Summers from the race to take over from Ben Bernanke at the end of his term as Fed chairman. It was anticipated that Summers would take a move dovish approach to the currency, tightening policy. His replacement as favourite, Janet Yellen, is very much in the same mould as Bernanke, and, if nominated, would likely continue with his monetary expansionist policies, further debasing the currency.
It is expected that the Fed will announce its intention to trim $10bn from its monthly asset purchase programme when its two-day meeting concludes tomorrow. Any increase on this predicted figure could trigger some dollar buying, but the emphasis for the dollar outlook is on forward guidance on Fed policy.
EUR/USD broke to USD1.3360 as European trading kicked off, continuing a bullish trend that has been in place since 6 September.
The spot Dollar index has declined to 81.2180, from a 6 September high of 82.6300.
Bearish views on the dollar against its majors have been entrenched this week by the departure of Larry Summers from the race to take over from Ben Bernanke at the end of his term as Fed chairman. It was anticipated that Summers would take a move dovish approach to the currency, tightening policy. His replacement as favourite, Janet Yellen, is very much in the same mould as Bernanke, and, if nominated, would likely continue with his monetary expansionist policies, further debasing the currency.
It is expected that the Fed will announce its intention to trim $10bn from its monthly asset purchase programme when its two-day meeting concludes tomorrow. Any increase on this predicted figure could trigger some dollar buying, but the emphasis for the dollar outlook is on forward guidance on Fed policy.