A rate hike by the FED is all but certain. The writing seems to be on the wall as the current 0.75% rate will not be enough to help the US keep up with the curve. The increase is expected at 0.25%, bringing the short-term borrowing rate to 1%.
AUD stays predictable, FED and ECB cannot promise the same
As expected, Governor Lowe reaffirmed that the interest rate for the Australian Dollar will remain at 1.5% for now. The cited reasons are the promising economic outlook with low inflation, but still sluggish employment rate. Consumer and business confidence have grown with exports being high and mining investments picking up again. The labor and housing markets were the only concerns at the meeting.
The global situation and the Year's End
The US Dollar has still shown a significant improvement in its price, although it has declined in the past two weeks and the US existing Home sales fell due to high mortgage rates. However, the crude oil jumped to $54 and has now made its way to its highest peak in the past 17 months all the while the Asian stock markets remained calm. The Wall Street stocks likewise dropped with the rise in US Dollar prices.
EUR/USD: Euro Strengthens, Tests 100DMA
The pair bounced higher on Wednesday as investors took profits from yesterday's slump.
Source: WBP Online
Forex - Dollar holds steady, traders await Yellen speech for Fed clues
The dollar stayed in consolidation mode on Friday after its rally to two-month highs ran out of steam with bulls looking for fresh guidance from the head of the U.S. central bank.