Forex Today: Dollar surrenders post-Fed gains, Aussie and Bitcoin tumble, BOE in focus

Yohay Elam FXStreet

Here is what you need to know on Thursday, September 19:

The US dollar is off its highs against major pairs as markets digest the Federal Reserve's decision. The Fed cut rates by 25 basis points as expected and the dot-plot signaled no further cuts this year or the next. Chair Jerome Powell conveyed a balanced message of doing what is necessary according to data on "meeting by meeting" basis. Gold has also recovered and is trying to recapture $1,500.
The Bank of Japan left its interest rate unchanged at -0.10% and did not introduce additional measures. The yen strengthened as the BOJ is not matching its peers with further stimulus.
The Bank of England is set to leave its policy unchanged with interest rates at +0.75%. While wage growth has accelerated, inflation has decelerated. Uncertainty about Brexit paralyzes policymaking. A unanimous voting pattern is on the cards. Speculation about a potential extension of Governor Mark Carney's term will probably not be addressed in this decision. UK retail sales are due out just before the decision.
The Swiss National Bank (SNB) is set to leave its Libor Rate at -0.75%. The Swiss franc has weakened in recent weeks after seeing safe-haven flows earlier.
The Australian dollar has lost ground and dipped below 0.68 after the unemployment rate rose to 5.3%. However, the economy gained more jobs than expected and the participation rate has risen.
The New Zealand dollar has stabilized after second-quarter GDP beat expectations with 0.5% QoQ. Annual growth is slowing down.
Oil prices have consolidated their losses with WTI Crude Oil trading around $58. Saudi Arabia sounded confident about restoring oil output following the weekend attack on its installations. US President Donald Trump has announced new sanctions on Iran, the alleged perpetrator of the attack, in a move that probably averts war.
The US economic calendar features the Philly Fed Manufacturing Index, Jobless Claims, and Existing Home Sales. These second-tier figures may impact currencies if they all go in the same direction.
Bitcoin fell below $10,000 and carried other cryptocurrencies lower. Ethereum and Ripple had previously gained ground.

Author

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

EUR/USD accelerates losses, focus is on 1.1800

EUR/USD’s selling pressure is gathering pace now, opening the door to a potential test of the key 1.1800 region sooner rather than later. The pair’s pullback comes on the back of marked gains in the US Dollar following US data releases and the publication of the FOMC Minutes later in the day.

GBP/USD turns negative near 1.3540

GBP/USD reverses its initial upside momentum and is now adding to previous declines, revisiting at the same time the 1.3540 region on Wednesday. Cable’s downtick comes on the back of decent gains in the Greenback and easing UK inflation figures, which seem to have reinforced the case for a BoE rate cut in March.

Gold picks pace, flirts with $5,000

Gold is back on the front foot on Wednesday, shaking off part of the early week softness and pushing higher towards the key $5,000 mark per troy ounce. The move comes ahead of the FOMC Minutes and is unfolding despite an intense rebound in the US Dollar.

Fed Minutes to shed light on January hold decision amid hawkish rate outlook

The Minutes of the Fed’s January 27-28 monetary policy meeting will be published today. Details of discussions on the decision to leave the policy rate unchanged will be scrutinized by investors.

Mixed UK inflation data no gamechanger for the Bank of England

Food inflation plunged in January, but service sector price pressure is proving stickier. We continue to expect Bank of England rate cuts in March and June. The latest UK inflation read is a mixed bag for the Bank of England, but we doubt it drastically changes the odds of a March rate cut.

Sui extends sideways action ahead of Grayscale’s GSUI ETF launch

Sui is extending its downtrend for the second consecutive day, trading at 0.95 at the time of writing on Wednesday. The Layer-1 token is down over 16% in February and approximately 34% from the start of the year, aligning with the overall bearish sentiment across the crypto market.