EURUSD seems to have entered into a consolidations phase this Thursday

<p>  EUR/USD Range: 1.4103 – 1.4146 Support: 1.3990 Resistance: 1.4160 EURUSD seems to have entered into a consolidations phase this Thursday during the Asian session. The pair is […]</p>

 

EURUSD

EUR/USD

Range: 1.4103 – 1.4146
Support: 1.3990
Resistance: 1.4160
EURUSD seems to have entered into a consolidations phase this Thursday during the Asian session. The pair is trading in a range of 1.4103 and 1.4146 after the rally that followed the Fed’s announcement. Today we also have the meeting of the ECB Governing Council. They are set to discuss tenders, interest rates, and of course negotiations to bring about a new regulatory framework to the EU nations. QE will however be off the agenda!

 

 

GBPUSD

GBP/USD

Range: 1.6092 – 1.6140
Support: 1.6010
Resistance: 1.6150
The BoE interest rate decision headlines the calendar. Although expectations call for no changes to the major elements of monetary policy (borrowing costs, asset purchases), the announcement warrants attention as Mervyn King will be making decisions based on an updated quarterly inflation report. The annualised price growth rate remains stubbornly above 3%, which is slightly lower than its first quarter peak, as the central bank predicted. Could this mean that there may be additional scope to consider stimulus to guard against a backslide into recession?

 

The FOMC

The highly anticipated FOMC rate decision failed to disappoint, but wasn’t necessary what the market had anticipated. The Fed kept their lending rate unchanged at 0.25% and went onto add that interest rates will remain “exceptionally low” for an “extended period”. The spotlight was placed on the QE measures and the Fed announced total asset purchases of $850 billion to $900 billion through June, and new asset purchases of $600 billion during the same period (which was slightly higher than the market anticipated). The implications of the decision are likely to be overall USD bearish, with the greenback seen in more of a gradual slow grind lower, rather than suffering any rapid declines.

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