Attention on the direction of European currencies following the FOMC meeting
03.11.2021
- U.S. FOMC Policy Rate and Statement Release
- Remarks by Bank of England Governor Bailey
Yesterday, the three major U.S. stock indices all extended their gains, resulting in a market environment characterized by rising stock prices, falling interest rates, and lower oil prices. WTI crude oil fell to $82.20 per barrel. Gold is trading in the $1,781 range. Although Australia’s policy interest rate, announced yesterday, was kept at 0.1%, the RBA stated that it would abandon its goal of keeping bond yields at low levels.
A wait-and-see mood has taken hold in the foreign exchange market ahead of today’s FOMC meeting in the U.S., and no significant fluctuations are being observed. However, the pound—which is drawing attention ahead of tomorrow’s policy rate announcement—is trading weakly against the yen, with GBP/JPY hovering around 155.12. Since GBP/JPY is already breaking below the 20-day moving average, we need to carefully assess whether it will continue to decline.
Today’s schedule includes the UK Nationwide House Price Index and Turkey’s Consumer Price Index and Producer Price Index at 4:00 PM, the UK Services PMI and remarks by ECB President Lagarde at 6:30 PM, the US MBA Mortgage Applications Index at 8:00 PM, the US ADP National Employment Report at 9:15 PM, and the US Services PMI (final reading) at 10:45 PM.at 11:00 PM: US ISM Non-Manufacturing PMI; at 11:30 PM: US weekly crude oil inventories; at 1:00 AM: remarks by Bank of England Governor Bailey; at 3:00 AM: announcement of the FOMC policy rate and statement; and at 3:30 AM: press conference by Federal Reserve Chair Powell.While paying close attention to the FOMC statements, I will be closely monitoring the positioning of European currencies.
Author: Keisuke Sakurai
