Broader USD steady ahead of FOMC meeting. GBP lags on in-line UK CPI + Brexit amendment vote antics. EUR bid but large option expiry looms below.
Wednesday, June 13, 2018
USDCAD:Dollar/CAD is trading higher yet again this morning, but the gains have been marginal as all markets settle into a lull ahead of the FOMC meeting later today. Yesterdays price action was muted as well, with US CPI coming in as expected and the only move coming from a Dow Jones article that hinted at press conferences to follow EVERY Fed meeting going forward. This got some USD longs excited as it technically makes more rates hikes this year feasible, but again the broad USD move higher wasnt anything to write home about. The FOMC announcement will come at 2pmET today, followed by a press conference at 2:30pmET. Traders are largely expecting a hike of 25bp, and so the focus will be on Jerome Powells tone as usual when he speaks to reporters. USDCAD remains in good technical shape at this hour because the pair continues to trade above the key trend-line support at the 1.3000 level. July crude oil is softer this morning after a bearish API inventory report late yesterday and headlines that Russia is willing to increase production to 2016 levels. We get the weekly DOE inventory report at 10:30amET today. Todays calendar also features US PPI at 8:30amET. A hawkish hike today from the Fed could very easily see the markets make a run for the 1.3070s, while a dovish hike will likely see traders attack chart support and Sundays opening gap in the 1.2940-50 area.
EURUSD:Euro/dollar was looking a little shaky yesterday afternoon after the