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Currency Market Analysis

Dec 19, 2018 | Currency Market Analysis

Global Themes

Greenback slips as Fed uncertainty grows

The US dollar fell overnight as markets turned nervous ahead of tomorrow morning’s all-important Fed decision.

The US Federal Reserve meets tomorrow in what is being called one of the most important meetings since 2013.

The Fed is expected to raise rates tomorrow but with sharemarkets pressured, global growth slowing, and a cacophony of criticism from the US president Donald Trump, the potential for a surprise has grown over the last two weeks.

Commodity plunge

The USDSGD fell back to two-week lows with the US dollar weaker in most other markets.

The euro and British pound both slipped lower.

The AUD was weaker as commodity prices tumbled.

Crude oil plunged 7.3% while copper dropped 3.4%.

Fed ahead

The US Fed decision is due at 3.00am with the press conference due at 3.30am.

The most recent market pricing found a 72% chance of a hike (source Reuters).

Tomorrow’s likely to see one of the business days of the year, with NZ September-quarter growth figures, Australian employment, the Bank of Japan and Bank of England all due.

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