Yesterday, the USD had a strong trading day supported by a bullish trend against its most rivaled currencies. The greenback’s positive momentum occurred thanks to yet another day of falling oil prices and renewed views in the market that the U.S. economy is showing some signs of recovery a day after the Federal Reserve maintained interest rates at the same level. Some of the more notable currencies to fall against the greenback were the euro, which fell to a seven week low of $1.5398, its lowest intraday level since June 16. Against the JPY the USD hit a seven-month high at 109.39, its highest value since January.
On Tuesday after the Federal Reserve held its benchmark federal funds rate steady at 2% and signaled in an announcement that there is no rush to raise borrowing costs, many analysts perceived that the real reason on this decision was more based on worries about economic growth than about inflation. But certainly as a result of the there looks to be a renewed environment for risk appetite, propitiating investors to seek refuge in “carry trading”.
Today the US economy will provide some significant market making news. Traders must follow the Unemployment Claims report, one of the most influential USD indicators, is forecasted by analysts to show a decrease of 28k jobless individuals, from 448K last week. At 14:00GMT we have the Pending Home Sales, which is forecasted to decrease by 1.0%. Such results should outcome provide a volatile session; traders should follow today’s events with extra caution.