Federal Reserve language divulged in the publication of meeting minutes gave the strong indication that monetary stimulus policy in the world’s largest economy are looking increasingly less likely to happen. The wait and see move adopted by the Fed revealed in the minutes, showed members faith in the US economy gathering enough momentum on its own, without the need for government intervention. The release sent Stocks down across the globe with the Nikkei 225 of Japan plummeting 2.36% to 9813.00 and the US 30 down 0.49% to 13199.55.
The Fed no to intervention saw the USD strengthen against most major currencies. In the EUR/USD pairing, the EUR was down 0.19% against the USD, which also made gains of 0.12% against the GBP. The biggest gains for the greenback was against the commodity linked Australian Dollar. Australia has a wealth of raw minerals all traded in US Dollars, so when the value of certain commodities like Gold fall, as they invariably do when the USD strengthens, the value of Australia’s mineral wealth lessens and subsequently the commodity sensitive Aussie lessens too. The AUD/USD saw the largest movement in the currency markets, down 0.43%, trading at 1.0287. The decline was also aided by the Australian Bureau of Statistics releasing falling trade balance figures showing a seasonally adjusted fall to -0.48B, from -0.67B in the month before.
The fears of easing stimulus abating, strengthening the USD, meant large falls in the commodity markets. Gold saw a fall of 1.67%, with a troy ounce trading at 1644.15, but the largest declines were seen with Silver, down 2.72%, trading at 32.360.
In Denmark, the creativity of real estate agents in crisis knows no limits. Indeed, an agency in Copenhagen is offering home buyers a free car as a gift for their purchase.
Today should be a busy day for the EUR/USD pairing with plenty of activity. Starting at 12.45pm GMT the interest rate in the Eurozone is to be announced, although no change is expected from the current 1.0% mark. Then you have a series of events with Treasury secretary Geithner speaking at 1pm in the US and then before an ECB press conference at 1.30pm, there is the release of ADP Nonfarm, employment change figures in the US. A busy day indeed for the EUR/USD with plenty of profit opportunities today for the binary trader.
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