FXstreet.com (Córdoba) - The US dollar is modestly lower on balance as financial markets enjoy a calmer day today, notes the Wells Fargo team. "Spain's Prime Minister outlined further budget savings, while in Eurozone bond markets, both Spanish and Italian ten-year bond yields are lower", they say. "Those developments are contributing to some stabilization in the euro, along with gains for the pound and Swedish krona". The AUD, NZD and CAD are also benefiting from the more stable backdrop.
Financial markets are also anticipating the minutes of the latest Federal Reserve monetary policy meeting later today when the Fed decided to extend its Operation Twist program. "The minutes will be scanned for any hints that a further expansion of the Fed's balance sheet (i.e. outright bond purchases) is also a possibility", Wells Fargo says.
"Overall, we don't see today's price action as decisive, and the price action of the euro in particular remains less than convincing", they add. "Nonetheless, over the coming weeks and months we still expect some improvement in market sentiment, an environment that should be favorable for the commodity and emerging currencies in particular".
Financial markets are also anticipating the minutes of the latest Federal Reserve monetary policy meeting later today when the Fed decided to extend its Operation Twist program. "The minutes will be scanned for any hints that a further expansion of the Fed's balance sheet (i.e. outright bond purchases) is also a possibility", Wells Fargo says.
"Overall, we don't see today's price action as decisive, and the price action of the euro in particular remains less than convincing", they add. "Nonetheless, over the coming weeks and months we still expect some improvement in market sentiment, an environment that should be favorable for the commodity and emerging currencies in particular".
