EUR USD Exchange Rate Fluctuates Ahead of Key Fed Policy Meeting


Stocks rallied for a fifth day, sending the benchmark index Monday to a new all-time high near 8,300 points, following a record-breaking Wall Street session amid optimism the United States will pursue a peaceful resolution to North Korea's nuclear threats. On Wall Street, the futures for the Dow Jones industrial average and for the Standard & Poor's 500 were up 0.2 percent.

The Australian and New Zealand dollars pushed higher, with up 0.57% at 0.8056 and with advancing 0.77% to 0.7373.

The Fed is due to announce its decision at 1800 GMT on Wednesday and is widely expected to keep rates unchanged after a two-day meeting but could begin paring its bond holdings, with reductions likely to start in coming months. "Some US dollar recovery would be in line with that".

And the Fed's preferred inflation measure, the Personal Consumption Expenditures price index, has been steady at 1.4 percent, while the core measure has been below the central bank's two percent target for more than five years. Lira reacted negatively to the comments made by Mark Carney, the chairman of the British Central Bank.

In Asia on Monday Hong Kong ended up 1.3 percent, Shanghai closed 0.3 percent higher and Sydney rallied 0.5 percent.

On Tuesday, The US President, Donald Trump, worsened his altercation with North Korea across its nuclear encounter, sending intimidation that'll "totally destroy" the country and making a mockery of its leader, Kim Jong Un calling him as a "rocket man".

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Investors will also be watching for signals that the Fed will raise rates in December, and for any clues on personnel changes as the end of Fed Chair Janet Yellen's term approaches and after the resignation of Vice Chair Stanley Fischer earlier this month.

'That's why, even though core consumer prices are showing some resurgence, we now expect the Fed to stand pat on rates for the rest of this year'.

USA crude oil prices CLc1 edged up 2 cents to settle at $49.91 a barrel, after hovering near multimonth highs. The week will also bring with it housing starts figures on Tuesday, existing home sales on Wednesday, the Federal Housing Finance Agency's house price index on Thursday and the PMI composite flash on Friday. Building permits rose by 5.7% to a rate of 1.3 million, slightly higher than an expected 1.22 million.

USA crude oil prices slipped below $50 per barrel but stayed close to multi-month highs as refineries in Texas continued to restart after Hurricane Harvey.

Gold for December delivery fell 0.7% to $1,315.40 a troy ounce on the Comex division of the New York Mercantile Exchange. The front-month U.S. oil futures contract was holding onto $50 a barrel at 50.40 as higher than expected crude oil stocks were counterbalanced by a substantial draw in distillate stocks (-5.6 million barrels). The euro was up at $1.1945 from $1.1928.