All Eyes on the Direction of European Currencies Following the FOMC Meeting
03.11.2021
- U.S. FOMC Policy Rate and Statement Announcement
- 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 crude oil prices. WTI crude oil fell to $82.2 per barrel.Gold is trading in the $1,781 range. Although Australia’s policy interest rate, announced yesterday, was held steady at 0.1%, the RBA stated that it would abandon its goal of keeping bond yields at low levels.
A wait-and-see sentiment is spreading in the foreign exchange market ahead of today’s U.S. FOMC meeting, and the market is showing no significant fluctuations. 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 on the daily chart, we need to carefully assess whether it will continue to decline from here.
Today, at 16:00, the UK Nationwide House Price Index, Turkey’s Consumer Price Index and Producer Price Index; at 18:30, the UK Services PMI and remarks by ECB President Lagarde; at 20:00, the U.S. MBA Mortgage Applications Index;at 9:15 PM, the U.S. ADP National Employment Report; at 10:45 PM, the U.S. Services PMI (final reading); at 11:00 PM, the U.S. ISM Non-Manufacturing Index; at 11:30 PM, U.S. weekly crude oil inventories;at 25:00, remarks by Bank of England Governor Bailey; at 27:00, the FOMC will announce its policy rate and statement; and at 27:30, Federal Reserve Chair Powell will hold a press conference. While paying close attention to the FOMC’s remarks, I will be keeping a close eye on the positioning of European currencies.
Author: Keisuke Sakurai
