US Dollar finds support around 90.20, FOMC eyed
- The index eased from session highs and tested lows near 90.20.
- US 10-year yields are softer, dropping to the 2.88% neighbourhood.
- The Federal Reserve is expected to hike rates by 25 bp later today.
The greenback, in terms of the US Dollar Index (DXY), is trading on the defensive early in the European morning around the 90.20 region ahead of the key FOMC gathering due later in the day.
US Dollar focused on the FOMC
The index keeps the choppy trade so far this week, managing well to remain in the upper end of the range and above the psychological 90.00 milestone, with gains capped by the 90.40/55 band for the time being.
The up move in the buck came along a recovery in yields of the key US 10-year note to the 2.90% neighbourhood, albeit losing some upside momentum since then. In light of the upcoming FOMC meeting, the 3.00% level is now considered as crucial by market participants.
Despite investors have largely anticipated a rate hike today, the focus of attention has shifted to Powell’s updated outlook on the economy and the much awaited ‘dots plot’.
On a secondary role, Existing Home Sales for the month of February is also due ahead of the weekly EIA report on US crude oil stockpiles.
US Dollar relevant levels
As of writing the index is losing 0.26% at 90.18 facing the next support at 89.76 (low Mar.19) seconded by 89.56 (low Mar.14) and then 89.41 (low Mar.7). On the flip side, a break above 90.44 (high Mar.20) would open the door to 90.57 (high Feb.8) and finally 90.93 (high Mar.1).
Author
Pablo Piovano
FXStreet
Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.
