Home Forex Daily Analysis – December 16th 2008
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Forex Daily Analysis – December 16th 2008

The US dollar retreated some more on Monday, especially against the Euro. USD.EUR currently stands at 1.3691, breaking resistance of 1.35. Also the British pound managed to get away from the 1.50 pivot spot, now trading at 1.5278. GBP/USD struggled more than the Euro.

The loonie (USD.CAD) and the chocola (USD/CHF) also weakened – USD wekened. Also the New Zealand dollar and the Australian made gains against the dollar.

The only stable pair is USD/JPY. After breaching the 90 Yen mark near the end of last week, it returned to sit above 90, and it doesn’t make big moves like other currencies. The thought of a big intervention by the BOJ looms over this pair.

Federal Reserve to cut interest rates

Today, at 19:15 GMT, the Federal Reserve is due to announce yet another cut in interest rates. Some analysts expect a sharp cut of 0.75% to 0.25%. The more common sentiment is of 0.5% cut.  

This event is the focus of all traders today.

Other news expected today: French, German and European  Flash Manufacturing PMI and Services PMI,  British CPI, Bank of England’s Inflation letter, US building permits, US Consumer Price Idnex (and core CPI),  and American housing starts.

But as aforementioned, although some of this expected data would be major in a regular day, forex traders will be anticipating today’s interest rate, and the following statement by Ben Bernanke.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.