With the Fed’s ‘lack of urgency’-signal being in keeping with expectations the market response proved very restricted upon announcement, Danske Financial institution’s FX analysts report.
EUR/USD drops to 1.13 in restricted Fed response
“The curve bull-flattened barely whereas the USD gained considerably with EUR/USD falling to the 1.13 degree. At this stage lack of reports is sweet information for the dollar with traders possible trimming USD shorts (unfavourable carry) from stretched territory.”
“Whereas we preserve a strategic bearish view on the USD, we spotlight that our tactical conviction is low and with the uneven sensitivity skewed in the direction of USD-bullish information the current rebound may lengthen within the coming periods – naturally topic to information from the Trump administration.”
