The US dollar remains soft despite raising rates as expected and markets projecting two more. Part of this decline is that some in the market were hoping for firmer guidance. The US dollar index finished lower in volatile trading and is slightly lower again this morning.
Dollar pairs mirrored this move, with the EUR/USD rising above 1.1800 and holding this morning. The GBP/USD has made gains, but is struggling against Brexit uncertainty, but has still made two days of gains. By contrast, the AUD/USD continues to decline from 0.7650.
The USD/CAD slipped back from the highs yesterday, with 1.30000 continuing to act as resistance. The USD/CHF has continued its decline.
The USD/JPY is declining for the second straight day as the US dollar loses ground to the yen. The AUD/JPY’s decline is more severe, pushing back again from the 84.50 level. The EUR/JPY and GBP/JPY also have a negative bias.
Today we have UK retail sales at 09.30.
The ECB rate statement is at 12.45. The press conference follows at 13.30.
At 13.30, we get US retail sales and the unemployment rate.
The US dollar post Fed weakness has continued this morning, with the Swiss franc continuing to gain followers. With the Fed stopping short of some previous market expectations, there could be more downside from here.