Fed minutes raise expectations of increased stimulus

August 23, 2012 3:55 pm by

EUR USD

EUR/USD

Range: 1.2522-1.2572
Support: 1.2480
Resistance: 1.2625

After a day of consolidation the euro finally broke out through the 1.2500 level that had been protected with a 1.2000-1.2500 double no touch option. The minutes from the August FOMC meeting revealed that many committee members thought that additional monetary accommodation would likely be warranted fairly soon unless upcoming data showed a substantial and sustainable strengthening in the pace of recovery. The Fed minutes don’t necessary mean outright QE3.

 

 

GBP USD

GBP/USD

Range: 1.5866 – 1.5914
Support: 1.5800
Resistance: 1.6000

Broad based USD weakness post the FED minutes has taken cable through the 1.5900 level but just shy of the 1.5933 May high. All eyes now on US data going into the Jackson Hole speech at the end of the month as US data will take centre stage after the dovish Fed Minutes. I guess the trend is your friend despite poor UK fundamentals.

 

 

AUD USD
AUD/USD

Range: 1.0481-1.0547
Support: 1.0400
Resistance: 1.0600

The lifestyle currency was a little mixed in the general USD demise after the FOMC minutes moved closer to some sort of stimulus and although I think a change in language is more likely in September than outright purchases you can’t argue with the price action. The optimism for AUD was dented in the Asian session as the August China HSBC manufacturing PMI data disappointed the market. It fell to a 9-month low of 47.8 from 49.3 fuelling the export slowdown in the region. The PBoC Governor did respond to the data saying that all tools must be made available when managing monetary policy with local media reporting that the Central Bank will inject further system liquidity.

 

Fed minutes raise expectations of increased stimulus
0 votes, 0.00 avg. rating (0% score)

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Back to Previous Page

From time to time, City Index Limited’s (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.