The Fed rate decision kept EURUSD, USDJPY, and GBPUSD near unchanged early on Wednesday, with each pair trading within 0.09% of flat ahead of the policy announcement.
The source said the U.S. dollar showed little change against those three major pairs before the Federal Reserve releases its decision later today. The Fed will announce its policy decision at 2:00 PM ET. Chairman Kevin Warsh will then hold a press conference at 2:30 PM ET.
The article said this meeting has become one of the most uncertain in years. However, it added that Warsh has offered little forward guidance. It also said recent economic data has sent mixed signals.
Fed Rate Decision and Major Pairs
Ahead of the Fed rate decision, EURUSD, USDJPY, and GBPUSD all stayed in tight ranges. As a result, the dollar was little changed against the euro, yen, and pound in early trading.
The source did not report major moves in those three pairs beyond their narrow daily changes. Instead, it highlighted that all three remained close to unchanged before the Fed statement and press conference.
AUDUSD Falls After Soft Australia CPI
AUDUSD was the biggest mover among the pairs mentioned, falling 0.47%. That move pointed to a stronger U.S. dollar against the Australian currency.
Australia’s June CPI report came in softer than expected. Headline inflation fell 0.1% on the month, compared with expectations for a 0.2% rise. Meanwhile, the annual inflation rate slowed to 3.8% from 4.0%, and that was also below forecasts.
The Reserve Bank of Australia’s preferred trimmed mean CPI matched expectations at 0.3% month on month. However, it slowed from the prior month’s 0.4% increase. The source said this suggested underlying inflation pressures continued to ease.
Because of that data, the report said the CPI release is likely to support expectations that the Reserve Bank of Australia can stay patient on further policy tightening. It added that this reduces the urgency for another rate hike in the near term.
On the technical side, the source said AUDUSD fell below a swing area and trend line support after that level held a day earlier. Consequently, sellers gained room to push the pair lower.
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Source: InvestingLive
