The US central bank is expected to hike interest rates by another 25 bps. What will happen to the EUR/USD?
The EUR/USD is wasting no time in consolidation ahead of a major market mover. Instead, the euro is fighting to regain what it lost over the past week. The European currency advanced this morning to levels above $1.1030, after touching a two-week low of $1.0942 yesterday.
The volatility train is making no stops today and both currencies are bound to feel the impact from a keenly-watched economic update. It’s Fed Day! To break it down, the Federal Reserve is wrapping up its two-day meeting with a rate decision announced by none other than Fed chief Jerome Powell.
Analysts are eyeballing a moderate 25 bps rate lift. If confirmed, the EUR/USD may not have much trouble tuning its exchange rate to accommodate the raise. If the Fed halts its rate increases, the dollar may be looking into a pronounced reaction as investors pivot their portfolio accordingly.
