- AUD continues to gather strength against USD on Wednesday.
- US Dollar Index slumps to 97.40 during American session.
- Coming up: FOMC policy announcements and Chairman Powell’s press conference.
The AUD/USD pair capitalized on the broad-based USD weakness during the American trading hours and advanced to its highest level since November 11th at 0.6868. As of writing, the pair was trading at 0.6865, adding 0.8% on a daily basis.
USD remains on the back foot ahead of FOMC
The data published by the US Bureau of Labor Statistics on Wednesday showed that inflation, as measured by the core Consumer Price Index (CPI), stayed unchanged at 2.3% on a yearly basis in November. Although this reading came in line with the market expectation, the greenback came under modest selling pressure with the initial market reaction. Additionally, capital flows into London fix seems to have weighed on the USD ahead of the FOMC event. At the moment, the US Dollar Index is down 0.13% on the day at 97.40.
Commenting on the inflation report, “although inflation has been a factor in the Fed’s reasoning behind its easier stance this year, we don’t see this month’s CPI reading changing the calculus for the Fed in the near-term, said TD Securities analysts. “We expect the Fed to keep rates on hold in the near term, but to ease further in 2020 as economic growth continues to moderate.”
At 19:00 GMT, the Federal Reserve will release its monetary policy statement and the updated economic projections, which will reveal the FOMC members’ rate cut intentions for 2020. At 19:30 GMT, FOMC Chairman Jerome Powell will appear in the last press conference of the year to deliver his remarks on the policy outlook and will respond to questions from the press.
Technical levels to consider
Share
