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Session Recap: USD consolidates ahead of Fed statement

FXStreet (Córdoba) - A quiet session has seen majors consolidating in familiar ranges as investors refrain from taking big positions ahead of the Federal Reserve monetary policy decision later in the day.

The euro and the pound advanced modestly versus the dollar following decent domestic data, but lacked real strength to break free from their weekly ranges. EUR/USD printed a daily high of 1.2970 after the Eurozone’s consumer price index rose 0.4% YoY in August, slightly above expectations.

GBP/USD jumped to a high of 1.6335, finally filling last week’s gap, after better-than-expected employment figures and BoE minutes, which showed two MPC members voted to hike rates last meeting.

USD/JPY inched up but remain capped by the 107.40 area. AUD/USD steadies below 0.9100 following yesterday's rally.

A liquidity injection operation by the PBoC has helped equity markets, with the Stoxx Europe 600 gaining for the first time in nine days, while US futures point higher.

The Federal Reserve will decide on monetary policy today, with investors paying special attention for any possible changes to the wording of the Fed statement. Before the FOMC decision, the US will report August CPI figures and the Q2 current account.

Main Headlines in Europe:

What’s the sentiment around the EUR/USD today? – OCBC Bank and Scotiabank

Gold extends recovery from 8-month low ahead of FOMC meeting

UK: Claimant Count Change down 37.2K in August

BoE Minutes: MPC voted 7-2 to keep interest rate steady

Switzerland ZEW Survey - Expectations down to -7.7 in September from previous 2.5

EMU: Annual CPI steady at 0.4% in August

European stocks rise ahead of Fed

Germany 2-year Notes auction declined to -0.07% from previous 0%

AUD/USD a test of 0.9100 is not ruled out – OCBC Bank

Emmanuel Ng, FX Strategist at OCBC Bank, said the pair has the potential to stab the 0.9100 area...
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