Here’s a look at what to expect when the Bank of England’s latest interest-rate decision is announced at 7 a.m. Eastern on Thursday.
Based on the early price action and the current price at 1.1054, the direction of the EUR/USD the rest of the session on Wednesday is likely to be determined by trader reaction to the 50% level at 1.1045 and the 61.8% level at 1.1073.
UK Inflation was weaker than expected on Wednesday and with the BOE announcement a probable non-event on Thursday, Sterling continues to be strapped by Brexit uncertainty.
Today’s Fed decision could produce a wicked two-sided trade because there is a little uncertainty ahead of the announcements. The Fed is widely expected to cut its benchmark interest rate 25-basis points. This news has been priced into the financial markets for weeks. The Fed’s monetary policy statement and interest rate forecasts are uncertain however.
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Investing.com - Wall Street slipped lower at the open on Wednesday as investors waited for the Federal Reserve’s latest interest rate decision later in the trading day.
EUR/USD is down slightly in early trading on Wednesday. The pair had a muted reaction to CPI data which came in unchanged for the year. The Fed meets later today and a volatile reaction is expected in the exchange rate.
Look for enhanced volatility with the release of the Fed announcements. Firstly, there will be a reaction to the interest rate decision. Although a rate cut is expected, there are still enough traders on the sidelines to produce a wicked reaction.
After briefly piercing to a fresh eight week high, GBP/USD has fallen under pressure in early trading on Wednesday as UK inflation data came in softer than expected.
U.K. consumer prices slowed to 1.7% year-over-year growth in August from 2.1% in July, the Office for National Statistics said Wednesday. Economists polled by FactSet expected a 1.9% rise. Core CPI slowed to 1.5% from 1.9%. The ONS said the decline came from principally games, toys and hobbies, and cultural services, clothing and sea fares. The pound was trading at $1.2452, down from $1.2501 on Tuesday.
Investing.com - Gold prices were hovering near the $1,500 level on Wednesday as investors awaited the outcome of the Federal Reserve meeting later in the day, where the central bank is expected to deliver a rate cut.
Based on the early price action and the current price at .6839, the direction of the AUD/USD on Wednesday is likely to be determined by trader reaction to the downtrending Gann angle at .6652. Look for a two-sided reaction with the release of the Fed announcements at 18:00 GMT.
On the weekend, there was a drone attack against the world’s largest oil processing facility and a major oilfield in Saudi Arabia. Oil prices have predictably spiked, but how will this geopolitical shock affect the gold market in the days ahead?
We’re seeing limited movement in the currency markets in the Asian session on Wednesday. The Australian and NZ dollar remain rangebound, while the Chinese yuan is flat. All eyes are on the Federal Reserve, which is leaning towards cutting interest rates by 25 basis points. If the Fed does act, traders could be in for a bumpy ride during the day.
Investing.com - U.S. stock futures were pointing to a slightly lower open on Wall Street on Wednesday, ahead of a likely interest rate cut by the Federal Reserve at the conclusion of its latest meeting later in the day.
Relief is set to sweep across financial markets after Saudi energy minister pulled down the threat of an escalation in geopolitical tensions in the region, and by stating the Oil production output will be fully back online by the end of September.
With economic data on the lighter side, the market focus will be on Brexit chatter and the FOMC. For the Loonie, inflation figures will also influence.
Gold futures are holding support around $1500 ahead of tomorrow’s Fed decision. Our intermediate cycle work supports a correction into October or November. A breakdown below $1490 in gold futures would signal the next leg lower in precious metals.
The currency markets have been quiet on Tuesday, with the pound, Canadian dollar and Mexican peso showing limited movement. However, the Fed meeting on Wednesday could trigger some movement. As well, investors will be keeping a close eye on CPI releases in Canada and the U.K.
Gold markets continued to go back and forth during the trading session on Tuesday, as we continue to drift around just above the $1500 level. That being the case, the market looks very likely to try to find support underneath.
The US dollar had rallied slightly during the trading session on Tuesday as we have reached relatively high levels against the Japanese yen. As we continue to bounce around just above the ¥108 level, it doesn’t take much imagination to think that perhaps traders are waiting for the Federal Reserve.