US Dollar Gains on Majors, Soft vs. Commodity Currencies

The US dollar traded generally higher against other majors today, though fell versus commodity currencies, even the extremely vulnerable Australian dollar. The current trading session was very light on macroeconomic data, with housing starts and building permits being the only report released in the United States today, and traders wait for tomorrow’s monetary policy decision from the Federal Reserve to drive the market.
The US Census Bureau reported that housing starts were at the seasonally adjusted annual rate of 1.27 million in May. While it was a small decline from the April’s revised level of 1.28 million, it was still a better reading than 1.24 million predicted by analysts. Building permits were at the seasonally adjusted annual rate of 1.29 million, about the same as in the previous month and in line with expectations.
The Fed will announce its monetary policy decision tomorrow at 18:00 GMT. While most market participants do not anticipate an interest rate cut at the nearest meeting, they will watch Fed’s comments for signs of cuts down the road. Some analysts said, though, that markets have priced in so much dovishness that a bit more neutral stance or any positive comment from the US central bank can easily lead to a significant rally.
EUR/USD declined from 1.1217 to 1.1189 as of 14:30 GMT today, retreating from its daily high of 1.1243. USD/JPY edged up from 108.54 to 108.62, bouncing from the daily low of 108.06. At the same time, AUD/USD advanced to 74.61 from the open of 74.36 and rebounding from the session minimum of 73.92.

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