March 28th - Although the economic calendar isn’t completely devoid of events ahead of today’s FOMC rate verdict, in many ways it might as well be. Traders will be looking to Ben Bernanke for any direction at all as to the Fed’s future stance over monetary policy and although consensus seems to be that we’ll see a 25 point hike and very little else will be given away, it is still seen very much as the news to watch. Major currencies have lost a little ground against the dollar through the overnight session as traders position ahead of the rate announcement with the Euro edging back to test the psychological 1.20 mark, down from the week’s highs of around 1.2060. The German IFO business sentiment reading may however be able to offer some support here especially after yesterday’s consumer confidence data came in in-line with expectations. The ECB is taking a vigilant stance over inflation and further rate hikes – in turn lending additional support to the common currency - are therefore to be expected as the year progresses, although at the moment there’s no expectation of a move at the next meeting early next week. Assuming the Fed doesn’t give any additional clues away, today’s verdict could prove to be something of an anti-climax but ahead of this, meaningful direction may prove difficult to find…
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