Dollar Awaits Federal Reserve’s Latest Policy Meeting

USD
On Wednesday, the Greenback settled higher and traded near to one-week highs vs. a basket of major currencies, as traders awaited the minutes of the U.S. Federal Reserve’s latest policy meeting for further clues on the outlook for interest rates. The U.S. dollar remained backed against its major rivals despite sustained U.S. deficit worries.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up by 0.16% at 89.78

EUR
The Single currency fell slightly by 0.06%, to settle at $1.2330 retreating further from Friday’s three year high of $1.2554, as markets await the U.S. Federal Reserve’s latest policy meeting. Earlier data showed that the Private sector output in Germany eased slightly in February, but maintained strong growth momentum.

GBP
The Sterling pound fell by 0.22%, to settle at $1.3965. On the release front, traders are awaiting BOE's Carney speech due later in the day.

JPY
Against the JPY, the Greenback rose by 0.18%, to settle at ¥107.52, extending its bounce from Friday’s 15-month declines of ¥105.55.

Gold
Early on Wednesday, Gold prices declined to about one-week lows, as the US dollar recovered, despite caution ahead of the minutes of the Federal Reserve's latest meeting. The Precious metal is very sensitive to rising rates, which increase the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.Gold Futures - Apr 18 (GCJ8), fell by 0.03%, to settle at $1,330.80.

Oil
Crude oil prices declined dramatically, negatively affected by the Greenback's recent rebound and as market players grew more cautious ahead of this week's U.S. supply data. Crude Oil WTI Futures - Mar 18 (CLH8) fell as much as 1.13%, to settle at $61.09, and Brent Oil Futures - Apr 18 (LCOJ8) was down by 1.01% at $64.59.

The most important economic events:

GBP BOE's Carney, Broadbent, Haldane and Tenreyro Speak in London: (GMT 14:15) – Important.
USD FOMC Meeting Minutes (31 JAN): (GMT 19:00) – Important.

Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM Capital Limited. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.

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