22 August, 2013
The US dollar was traded upwards on Wednesday against most major currencies before the publication of the FOMC Meeting Minutes and it grew after the publication. In spite of the fact that the opinions of Fed leaders on the terms of bond purchase reduce divided, most Fed leaders’ wide support of the Fed governor Ben Bernanke’s plan on tapering off of incentives became evident although the minutes didn’t contain any apparent hints on the terms of QE reduce start.
It can be said that the text of the meeting minutes turned out without surprises. There are almost no changes in the Fed leader’s estimates of the state of the economy. Almost all FOMC members agreed that there was no need to make changes in the asset purchase program yet. The outlook of finishing QE program still depends on the data. Asset purchases will have been over by 2014 if the economic situation develops according to the expectations. In the whole the minutes raised the expectations that the Fed would start tapering off the economy incentive program within the next several months.
The dollar was supported on Wednesday by strong housing market data. Existing home sales grew by 6.5% in July compared with the prior month to 5.39 million houses at an annual rate, which turned out the highest reading for almost four years. A growth to 5.15 million houses was forecasted. Sales growth is likely to reflect consumers activity jump who want to close transactions before mortgage rates rise higher. Mortgage rate growth in the nearest weeks threatens to slow down the recovery rates of the housing market which is the US economic growth engine this year.
The pound was traded upwards on Wednesday and updated August maximum again but had lost all the growth by the end of the day. Some support was provided by the CBI’s report. CBI Industrial Order Expectations anticipating industrial indicator reached zero level in August against -12 in July and improvement expectations to -8 points, which turned out the highest reading in 2 years. Industrial production grew to 25 in August – the highest reading since March, 2011 against 15 in July. Such growth indicates that economic recovery which has started this year is gathering pace.
The Australian dollar hit 2-week low on Wednesday Vs the US dollar amid the fall of Asian developing countries’ currencies and the leak at NPP Fukushima that was declared the accident of the third level of danger according to the International Nuclear Event Scale. The Canadian dollar fell to 6-year low Vs the US dollar amid commodity assets price decrease.
On Tuesday March, 18 the US dollar was traded mixed before the announcement of 2-days FOMC Meeting on Wednesday. The US dollar increased vs. the pound sterling and the Canadian dollar, but decreased vs. the yen...
On Monday March, 17 the US dollar was traded mixed amid controversial statistics in the USA. The US dollar increased vs. the yen, but decreased vs. major commodity currencies...
On Friday March, 14 the US dollar decreased vs. the yen. The euro, and the pound sterling, but slightly increased vs. major commodity currencies having lost 0.2% to the dollar index amid the US Consumer Confidence decrease to 4-months low...
On Thursday March, 13 the US dollar increased vs. the euro, but decreased vs. the yen and major commodity currencies amid strong US data. The euro dropped after Draghi
On Wednesday the US dollar increased vs. the Canadian dollar and the yen amid finished meetings of the Bank of Canada and Japan...
On Monday the US dollar was traded with fall Vs the most major currencies after the release of weak Non-Farm Payrolls, but rose Vs the pound, and almost didn
This Monday the US dollar was traded with slight decrease Vs most major currencies amid weak US macro statistic data. The data of consumer confidence and personal income appeared to be worse than expected...
The US dollar fell slightly on Monday Vs the euro and the yen and almost did not change Vs the pound and commodity currencies amid contradictory statistics...
The US dollar was traded downwards on Tuesday Vs most major currencies before the FOMC meeting next week where a decision on QE tapering may be made but anyway it will be probably small, which is unlikely to support the dollar...
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