Yesterday we saw the US current account deficit come in worse than expected, -US$111.2 billion compared to the consensus expectation of -US$96 billion. This data failed to move the dollar significantly as most participants where still waiting for last night’s Federal Open Market Committee statement and the rhetoric around the interest rate decision. When the wait was finally over and the Chair of the Federal Reserve spoke, the US dollar weakened across the board as the rhetoric was more positive about the US economy than expected, increasing risk appetite and undermining the US dollar given its safe haven status. The FOMC continued to reduce their programme of quantitative easing by another US$10 billion.
Today there is less data expected from the US, but it is worth mentioning that the initial jobless claim is expected to come in slightly better than previously, at 314.000. At 3pm, the Philadelphia Fed Manufacturing Index is due to be released, and this is expected to be lower than previous releases.