The dollar fell further against the euro today, extending its decline for the third straight session. The major event during Wednesday’s trading was the policy meeting of the Federal Reserve. As was expected, Fed members did not change the policy. The statement said that policy makers are going to assess the balance of risks (previous statements were saying that risks are balanced), suggesting that the Fed is less certain about its future actions than it has been before.
New home sales were at the seasonally adjusted annual rate of 544k in December, which was significantly above the predicted figure of 501k and the November’s revised rate of 491k. (Event A on the chart.)
Crude oil inventories swelled by 8.4 million barrels last week and were near the record level for this time of year. That is compared to the 3.8 million forecasted by specialists and the previous week’s increase by 4.0 million. Total motor gasoline inventories gained by 3.5 million barrels and were well above the upper limit of the average range. (Event B on the chart.)
FOMC kept its monetary policy unchanged during today’s meeting and released a statement, which was relatively balanced but leaning towards a dovish side. The Committee acknowledged that “economic growth slowed late last year” and removed wording about risks being balanced, saying instead:
The Committee is closely monitoring global economic and financial developments and is assessing their implications for the labor market and inflation, and for the balance of risks to the outlook.
The statement did not reveal the path for the future policy adjustments. (Event C on the chart.)
If you have any comments on the recent EUR/USD action, please reply using the form below.
