All thoughts for the US currency were this week centred on the Federal Open Market Committee (FOMC) meeting, where they would decide whether to repeat last month’s decision to reduce the level of quantitative easing. Optimism was high for this following recent positive data, but was dampened a little as the new home sales figures were lower than expected. The US currency struggled further on Tuesday as US core durable goods orders undershot predictions by a long way, failing to provide some last-minute encouragement.
The FOMC decision did, however, follow in last month’s footsteps as the Federal Reserve reduced their bond buying by a further US$10 billion a month. While this had little impact initially, the US dollar strengthened more throughout yesterday as investors digested the news, and did so for a fifth day against the euro. This was helped by consumer spending rising the most in three years, although the advance GDP, unemployment claims and pending home sales all missed their expectations, calming some of this enthusiasm.
A few mildly influential figures are due today, including personal spending and the Chicago Purchasing Managers Index amongst others, to supplement the week’s big news.
Thinking of buying or selling US dollars? Call your trader now for the latest rates as the pressure of the quantitative easing lessens.