Global markets dip on FOMC meet outcome

Global markets dip on FOMC meet outcome

Sinduja Venkat

Good morning and welcome to today’s foreign exchange market commentary on 20th of June. 

Here are’s top 5 currency highlights:

  • Sterling dips against Greenback post FOMC outcome
  • Eurozone ministers agree to new deal on origin of bailout funds
  • US stocks decline post stimulus meet
  • USD/JPY appreciates on FOMC Meet and Amari comments
  • USD/CAD ascent continues post strong US jobs data


GBP/EURO – 1.1645
GBP/USD – 1.5436
GBP/CHF – 1.4349
GBP/CAD – 1.5886
GBP/AUD – 1.6696
GBP/ZAR – 15.7505
GBP/JPY – 149.9370
GBP/HKD – 11.9728
GBP/NZD – 1.9658
GBP/SEK – 10.0050

Mid-market rates as of 2013-06-20 04:00 UTC

Key releases in the next 24 hours that may affect currency date:

Australia: No Data
Europe: EUR Euro-Area Finance Ministers Meet in Luxembourg, EUR Euro-Zone Consumer Confidence (JUN A)
United Kingdom:  No Data
New Zealand: No Data
United States of America: USD Initial Jobless Claims (JUN 15), USD Markit US PMI Preliminary (JUN), USD Existing Home Sales (MoM) (MAY), USD Leading Indicators (MAY), USD Philadelphia Fed. (JUN)
China: No Data
Canada: No Data
Japan: No Data

Sterling dips against Greenback post FOMC outcome

GBP/USD pair has been hovering in the region between 1.5450 and 1.5485 after the FOMC meet in the US as well as optimistic UK Retail sales figures. Sterling dipped from 1.5668 level to 1.5460 after the release of the FOMC outcome overnight. While no changes were made to the current pace of Quantitative Easing in the US, Fed’s Bernanke stated that downside risks to the outlook for the economy and the labor market as having diminished since September last year. This comment set off the global markets and stocks worldwide saw depreciation in its value.

Eurozone ministers agree to new deal on origin of bailout funds

Eurozone ministers have come to a deal on the origin of funds for the prospective bank bailouts from now on. According to the new deal the local government will contribute to 20% of the bailout amount whereas the ESM (European Stability Mechanism) bailout fund will pay up the remaining 80%. This decision comes as EU finance ministers have made an agreement for the ESM to be used as an investment vehicle for banks under stress.

US stocks decline post stimulus meet

US stocks dipped on Thursday as investor’s sentiments plummeted following the closing comments from the FOMC stimulus talks as well as a slowdown in Chinese manufacturing industry. The Dow Jones and the S&P declined the most in a single day this year. The Dow Jones fell by 353.87 points to 14,758.32 while the S&P 500 dipped by 40.74 points to 1,588.19. Greenback advanced well against all peers.

USD/JPY appreciates on FOMC Meet and Amari comments

USD/JPY ended trading on a higher note for the fourth consecutive day and added 103 pips to its value to close at 97.31 Yen. In addition, Japan’s economic minister Amari said on Thursday that his government is going to consider lowering corporate tax rates. The statement too helped boost the USD/JPY to higher highs.

USD/CAD ascent continues post strong US jobs data

The USD/CAD continued its ascent at 1.0381 (European session) while continuing to remain entrenched in the black post the release of US jobs data.

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