Euro flat before Fed meeting

The euro is broadly unchanged versus the US dollar ahead of the Federal Reserve meeting tonight.

Traders are playing the wait-and-see game; in the previous few days investors have anticipated that the Fed would keep their monetary policy unchanged, but this morning trading volumes are light and so is volatility, as traders are clearly unwilling to take a firm view on the market before the announcement.

The Fed is currently pumping $85 billion each month into the US financial system to encourage lending by banks. This policy may help the economy but it is having a negative impact on the value of the US dollar. If the Fed discuss cutting back stimulus, and even if the cutback won’t come on stream for a few months, we could see traders sell the euro versus the US dollar.

European Union officials have said it is unlikely the Cypriot bailout terms will be revised after the island nation was bailed out in April, which should bring some stability to the region.

Spot FX EUR/USD chart

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CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen. 79% van de retailbeleggers lijdt verlies op de handel in CFD’s met deze aanbieder.
Het is belangrijk dat u goed begrijpt hoe CFD's werken en dat u nagaat of u zich het hoge risico op verlies kunt permitteren.
CFD’s zijn complexe instrumenten en brengen vanwege het hefboomeffect een hoog risico mee van snel oplopende verliezen.