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FXStreet
Composed of a group of economic journalists and FX experts, the FXStreet content team produces and oversees all content published on FXStreet. It provides a purely journalistic approach to the Forex market.
USD/JPY remains close to the 160.50 intervention zone during the Asian session on Wednesday. Despite the BoJ's rate hike to its highest level since 1995, Japan's borrowing costs remain significantly lower than those of peer nations such as the US. Moreover, the BoJ's more cautious stance on bonds undermines the Japanese Yen and supports the currency pair. Meanwhile, the US Dollar remains on the back foot amid the optimism over the US-Iran peace deal and ahead of the Fed policy decision, capping spot prices.
AUD/USD is seen consolidating above mid-0.7000s during the Asian session as traders await the outcome of a two-day FOMC meeting later this Wednesday. In the meantime, the optimism over an interim peace deal between the US and Iran keeps the US Dollar bulls on the defensive. This, along with the RBA's hawkish pause on Tuesday, acts as a tailwind for the currency pair.
Gold preserves weekly gains registered over the past two days, though it remains below a technically significant 200-day SMA through the Asian session on Wednesday. Traders now seem hesitant and are keenly awaiting the highly anticipated Fed rate decision before placing fresh directional bets. In the meantime, the US-Iran interim peace agreement keeps the US Dollar bulls on the defensive, which might continue to act as a tailwind for the bullion.
Crypto exchange Coinbase unveiled a broad slate of new products on Tuesday, outlining plans to expand into tokenized equities and AI-powered investment tools in its pursuit of becoming an "Everything Exchange." A centerpiece of the roadmap is Coinbase's planned launch of tokenized US equities for customers outside the United States.
The most important event will be the Fed meeting on Wednesday, with Mr. Warsh now in charge. As more than one analyst points out, the case for holding rates the same is strengthened by the Iran deal and the prospect of the Strait re-opening, although nobody thinks Warsh can marshal enough doves to do a cut this time.
The Reserve Bank of Australia delivered more than what markets expected: a hawkish hold that should have supported the Aussie. But markets widely ignored it, focusing instead on slowing economic growth and proving that central bank messaging alone isn’t always enough to drive currencies.
