Forex Today: On-hold central banks left investors clueless

Here is what you need to know on Friday, September 18:

The dollar remained strong throughout the first half of the day, appreciating on risk-off mood. It started giving up in European trading hours and remained under pressure throughout the American afternoon.

The EUR/USD pair returned to pre-Fed levels, trading around 1.1840 heading into Friday.

GBP/USD is also flat, trapped between Brexit hopes and a dovish BOE.  EU Commission President Ursula von der Leyen said that she believes a trade deal with the UK was still possible despite the “distraction” caused by Boris Johnson’s Internal Market Bill.

Meanwhile, the BOE announced its latest monetary policy decision. The MPC voted 9-0 to keep rates and QE unchanged, as expected. However, policymakers mentioned negative rates, which spurred some selling around Pound’s crosses.  The UK will publish this Friday, August Retail Sales, seen up by 0.4% when compared to July.

Earlier in the day, the BOJ announced its latest monetary policy decision, and, as widely expected, the central bank left its monetary policy unchanged, while upgrading its economic assessment. Policymakers said that the economy has started to pick up “gradually,”  following the setback caused by the coronavirus pandemic.

 Gold trades at the lower end of its latest range, as on-hold central banks capped demand for the bright metal. Crude oil prices, on the other hand, remained strong, with WTI hovering around $41.00 a barrel.

US Treasury yields saw little action and ended the day flat. Equities had another bad day, with global indexes closing in the red.