The U.S. Dollar Index traded down to 94.00 before the Fed announced a 25 bps increase to the Fed Funds rate from 2.00% to 2.25% earlier today. The DXY index is currently trading higher at 94.28, but it has been trading in a range, with support seen at the 94.00 level and resistance in the 94.40 area.
The Fed’s Rate Statement noted that further increases in the Fed Funds Rate would depend on employment, sustained economic activity and inflation levels near the FOMC’s symmetric two-percent objective, noting that, “Risks to the economic outlook appear roughly balanced.” The U.S. also reported CB Consumer Confidence yesterday, exceeding expectations by a wide margin at 138.4, versus the 132.2 result anticipated.
Elsewhere, the Kiwi gained ground after the RBNZ left the Official Cash Rate unchanged at 1.75%. The central bank’s associated Rate Statement reiterated that, “We expect to keep the OCR at this level through 2019 and into 2020. The direction of our next OCR move could be up or down.” New Zealand also reported a wider-than expected -1.484B Trade Deficit on Tuesday.
On Thursday, the United States will release Final GDP and Core Durable Goods that are expected out at 4.2% and 0.4% respectively. Friday will see the UK Current Account and Final GDP releases for which the market consensus is centered around -19.4B and 0.4%. Canada will also release its GDP figure that is presently due out at 0.1%.
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