Fed Minutes To Cause Notable GBP/USD EUR/USD Movement

Published: 21 Aug at 10 AM Tags: Euro, Dollar, Pound Sterling, America, UK, Eurozone, Australian Dollar, New Zealand Dollar, Canadian Dollar, Australia, New Zealand, USA, Canada, Japan, South Africa,

Pound Sterling
GBP/EUR – Trading in the Region of 1.1690
In a relatively quiet news day, UK public sector net borrowing figures are likely to be the main driver of GBP/EUR movement in the hours ahead, but US news is likely to inspire extensive market movement overnight.

US Dollar
USD/EUR – Trading in the Region of 0.7468
The imminent release of the Federal Open Market Committee policy meeting minutes, which investors are hoping may provide more of an insight into a potential timeline for tapering stimulus, allowed the US Dollar to advance on rivals like the Yen overnight. ‘Greenback’ volatility will be high after the minutes are published at 19:00 GMT.

Euro
EUR/USD – Trading in the Region of 1.3398
In a light European news day the Euro continues to trade close to a six-month high against the US Dollar as hopes of strong Eurozone PMI data lend the common currency support. If tomorrow’s services/manufacturing data does show the forecast improvement the Euro could be boosted against its peers.

Australian Dollar
AUD/USD – Trading in the Region of 0.9037
After posting widespread declines in the aftermath of the publication of the Reserve Bank of Australia meeting minutes, the ‘Aussie’ continued to soften during the local session. With US news drawing focus the Australian Westpac leading index (which was unchanged in June following a decline of 0.1 per cent the previous month) had little impact on the currency.

New Zealand Dollar
NZD/USD – Trading in the Region of 0.7924
While US tapering talk weighed heavily on the ‘Kiwi’ over the course of Australasian trading, the New Zealand Dollar was also knocked by the news that national credit card spending dropped by 0.3 per cent in July.

Canadian Dollar
CAD/USD – Trading in the Region of 0.9586
The ‘Loonie’ edged down to a two-week low against the US Dollar as the North American session closed and investors speculated on the odds of the FOMC minutes providing a definitive start date for the tapering of easing. With Canadian news thin on the ground today additional movement in the commodity-driven currency will largely be the result of US developments.

Japanese Yen
USD/JPY – Trading in the Region of 97.5500
During local trading the Yen softened slightly against the US Dollar, shedding earlier gains, as the upcoming FOMC minutes led investors away from the safe-haven asset. If a timeline for tapering easing is offered the Japanese currency could fall further.

South African Rand
USD/ZAR – Trading in the Region of 10.1655
The Rand began the local session weaker against its rivals as investors await the publication of domestic inflation data. However, while local news could dictate the Rand’s movement in the hours ahead, US developments will be the major catalyst for emerging-market asset volatility.
As of Wednesday, 21st August 2013, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP EUR exchange rate was 1.1705, GBP USD exchange rate was 1.5623, GBP AUD exchange rate was 1.7408, GBP NZD exchange rate was 1.9886, GBP CAD exchange rate was 1.6379, GBP JPY exchange rate was 152.785, and GBP ZAR exchange rate was 16.2135.

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