USD remains within tight ranges as traders await deal announcement
City Index October 15, 2013 2:42 PM
<p>USD still holding its losses as optimism on a deal grows, with Congress looking likely to agree on a deal to re-open the government and […]</p>
USD still holding its losses as optimism on a deal grows, with Congress looking likely to agree on a deal to re-open the government and avoid a default. No details of the deal have yet emerged, due to which I believe the FX markets are currently still in very tight ranges. If the deal is only a short-term lift just to avoid the default then we could still see USD weakness as it would mean this could all happen again and it has just been prolonged.
Overnight the Aussie was the big mover after RBA minutes left the door open for a rate cut but was in no rush to use this option. We see AUD rally and holding this morning.
Today’s data to look for is the UK CPI – expected at 2.6% and in Europe the Germany ZEW expected at 59.4.
Today we see the release of industrial production figures from the EU and UK along with FOMC minutes from the September meeting where we will look to see how close the ‘no taper’ call was. Although I feel that this is rather insignificant following the US government shutdown and the view that tapering will now not start until 2014.
Supports 1.3530 1.3475 1.3450 | Resistance 1.3650 1.3675 1.3710
Supports 98.30 98.00 97.75 | Resistance 98.70 99.10 99.25
Supports 1.5950 1.5915 1.5850 | Resistance 1.6010 1.6060 1.6115
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