| 26 Jan 2022 |
21:46 |
Continues from previous update...
"At this time, we haven't made any decisions about the path of policy," Powell said. "I stress again that we'll be humble and nimble."
The Fed chief said policymakers have "quite a bit of room to raise interest rates without threatening the labor market" as they remove the extraordinary support provided during the pandemic. "The economy is quite different this time," Powell said.
"With inflation well above 2 percent and a strong labor market, the Committee expects it will soon be appropriate to raise the target range for the federal funds rate," the Fed's rate-setting Federal Open Market Committee said in a unanimous statement after the end of its two-day meeting.
Investors widely expect the Fed to raise its benchmark overnight interest rate from the current near-zero level at the March 15-16 meeting. Federal funds futures have priced in another three rate hikes in 2022 after the March liftoff.
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| 26 Jan 2022 |
21:45 |
USD/MAJORS - Dollar jumped in NY after hawkish comments from Fed's J. Powell. Reuters reported the Federal Reserve on Wednesday signaled it is likely to raise U.S. interest rates in March and reaffirmed plans to end its bond purchases that month as well before launching what was characterized as a significant reduction in its asset holdings.
The combined moves will complete the Fed's pivot away from the loose monetary policy that has defined the coronavirus pandemic era and toward a more urgent fight against inflation.
Fed Chair Jerome Powell, speaking in a news conference after the end of a two-day policy meeting, said the U.S. central bank will be open-minded as it adjusts monetary policy to keep persistently high inflation from becoming entrenched.
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| 26 Jan 2022 |
15:37 |
USD/CAD - 1.2621... Reuters reported the Bank of Canada held its key interest rate unchanged on Wednesday while signaling it would soon start hiking it, a move that surprised some analysts who had expected the central bank to take a first step toward tackling surging inflation.
The central bank instead removed its exceptional forward guidance, essentially a commitment to keep its key rate at the current record low of 0.25%, on the grounds that economic slack had been fully absorbed and inflation was set to be higher than previously predicted.
"Looking ahead, the Governing Council expects interest rates will need to increase, with the timing and pace of those increases guided by the Bank's commitment to achieving the 2% inflation target," it said in a statement.
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| 26 Jan 2022 |
12:28 |
EUR/GBP - 0.8346... Reuters news, UK PM Johnson says :
- EU is implementing N. Ireland protocol in an insane way
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| 26 Jan 2022 |
10:06 |
GBP/USD - 1.3500... The British pound briefly edged up to 1.3521 in Asian morning due to a late recovery in U.S. stocks overnight. However, lack of follow-through buying triggered profit-taking and the pair retreated in tandem with euro to 1.3494 in European morning before moving sideways.
Cable's strong rebound from Tuesday's 1-month trough at 1.3436 suggests recent decline from January's 2-month peak at 1.3749 has made a temporary low there and range trading would be seen, however, offers at 1.3520/30 and more above at 1.3540/50 would cap current rise and bring a much-needed retreat later.
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| 26 Jan 2022 |
04:01 |
EUR/USD - 1.1305.. Euro also moves narrowly but with a firm bias in Asia after staging a strg bounce fm a 1-month trough of 1.1264 in NY Tue. Although price remained on the back foot initially n fell from 1.1329 (AUS), intra-day accelerated in European morning on renewed usd strength n hit 1.1264 in NY morning as U.S. stocks were in the red. Euro later rebounded as intra-day strg recovery in the Dow triggered broad-based long liquidation in the greenback, the pair climbed back to 1.1306 ahead of the close, then 1.1310 in Asia.
Although Tue's rebound fm 1.1264 signals recent decline fm Jan's 7-week peak at 1.1482 has made a temp. low, further strg gain is not envisaged as market is anticipating a hawkish tilt by the Fed at the end of its 2-day FOMC meeting later today. Therefore, selling euro on further recovery is recommended for resumption of decline twd 2021 bottom at 1.1187 (Nov) next week. Bids are noted at 1.1295/85 with stops below 1.1260 while offers are tipped at 1.1310/20 with stops abv 1.1335, more stops are touted abv 1.1370.
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| 26 Jan 2022 |
03:51 |
USD/JPY - 113.87.. Dlr moves narrowly in subdued Asian morning after Tue's choppy swings as traders are keeping their powder dry ahead of FOMC's announcement. Despite Tue's retreat fm 114.09 (AUS) to 113.68 in Asia, price climbed to session highs of 114.15 ahead of NY open on renewed usd's strength but subsequent strg recovery in U.S. stocks after initial weakness triggered broad-based usd bashing, knocking price back down to 113.79.
Today's key focus is the outcome of the FOMC meeting n although market widely expects Fed to stand pat on its interest rate policy n wind down its asset purchase programme but make a first rate hike at its next meeting in Mar, a hawkish tilt by the Fed will send usd higher. Bids are noted at 113.65/70 with stops below 113.45 n offers are tipped at 114.10/20 with stops abv 114.25.
On the data front, we have some second-tier U.S. data ahead of Fed announcement at 19:00GMT n post-FOMC presser by Fed chair J. Powell at 19:30GMT.
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| 26 Jan 2022 |
00:20 |
USD/JPY - 113.85... Reuters reported some Bank of Japan policymakers saw consumer inflation briefly accelerating towards 2% as price pressures build up on changing corporate price-setting behaviour, a summary of opinions at the bank's January meeting showed on Wednesday.
"There's a chance year-on-year growth in consumer inflation may briefly approach 2%. If that happens, what's important is to look at facts behind the rise and whether they're sustainable," one of the BOJ's nine board members was quoted as saying.
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| 26 Jan 2022 |
00:05 |
Continues from previous update...
The single currency remained under pressure in Asia as continued weakness in Asian stocks triggered risk-aversion. The pair ratcheted lower in Europe and fell to a 1-month trough at 1.1264 in New York morning on usd's strength together with cross-selling of euro especially vs sterling. However, the pair then pared its losses and rebounded to 1.1360 near the close on broad-based retreat in usd due to recovery in U.S. stocks.
The British pound moved sideways inside a narrow range in Asia before edging up to 1.3496 in European morning. Despite falling to an intra-day low at 1.3436 ahead of New York open, price rallied to session highs of 1.3518 in New York afternoon in tandem with U.S. stocks.
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| 26 Jan 2022 |
00:04 |
U.S. Market Summary...
Dollar ends marginally higher on continued risk-aversion ahead of FOMC
Despite the greenback resumed its current ascent and hit a 2-week peak against majority of its peers as geopolitical tensions and continued weakness in global stocks triggered broad-based risk aversion, dollar pared intra-day gains and retreated on recovery in U.S. stocks in New York afternoon.
Versus the Japanese yen, although dollar met renewed selling at 114.09 in Australia and dropped to session lows at 113.68 in Asia, price erased its losses and gained to session highs at 114.15 in Europe on usd's broad-based strength before retreating to 113.79 in New York. |
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| 25 Jan 2022 |
15:26 |
USD/MAJORS - Reuters reported U.S. consumer confidence ebbed slightly in January, with more consumers planning to purchase homes, automobiles and other big ticket items even as they grew less optimistic about business and labor market conditions in the near term.
The Conference Board said on Tuesday its consumer confidence index slipped to a reading of 113.8 this month from a slightly downwardly revised 115.2 in December. Economists polled by Reuters had forecast the index declining to 111.8 from the previously reported reading of 115.8 in December.
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| 25 Jan 2022 |
09:58 |
GBP/USD - 1.3474... The British pound remained under pressure in Asia after overnight short-covering rebound from 1.3441 to 1.3492 at New York closing and retreated to 1.3468 in Asian morning before moving sideways. The pair then edged up to 1.3496 in European morning due partly to cross-buying in sterling especially vs euro before stabilising.
Although cable's rebound after Monday's fall to a near 3-week trough at 1.3441 suggests range trading would be seen, offers at 1.3510/20 should limit upside and bring another fall towards said bottom, break would extend recent decline to 1.3410/20.
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| 25 Jan 2022 |
09:10 |
EUR/USD - 1.1299... Reuters reported German business morale improved in January for the first time in seven months as easing supply bottlenecks helped to lift factory output in Europe's largest economy, a survey showed on Tuesday.
The Ifo institute said its business climate index rose to 95.7 from an upwardly revised 94.8 in December. A Reuters poll of analysts had pointed to a December reading of 94.7.
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| 25 Jan 2022 |
09:03 |
EUR/USD - 1.1296... Reuters news, Ifo economist says :
- German economy starts new year with glimmer of hope
- it is too early to talk about a turnaround of economic situation
- there is slight easing of supply shortages in industry
- raw materials and preliminary products supply issues have eased
- delivery bottlenecks in retail have also eased
- no easing of prices, at least every second industrial firm planning further price hikes
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| 25 Jan 2022 |
06:57 |
USD/JPY - 113.87... Reuters then reported Bank of Japan Governor Haruhiko Kuroda said on Tuesday global commodity inflation, rather than a weak yen, was largely to blame for the recent pick-up in domestic consumer inflation.
"Currency rates aren't moving sharply now, so I don't think we need to consider exchange-rate moves as a big factor behind recent price rises," Kuroda told parliament.
He also reiterated the BOJ's resolve to keep monetary policy ultra-loose as it was hard to project inflation approaching the bank's 2% target for the time being.
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