Dollar pays no attention to the Fed's caution, American grows stronger!

The dollar returned to growth, which may continue. Investors choose safe currencies after reports of tensions in US-China trade negotiations but growth is hindered by the Fed's caution. Volatility in foreign exchange markets fell sharply due to the "dovish sentiment" from main central banks, including the US Federal Reserve. But even in such a situation, the dollar manages to demonstrate amazing resilience. The negative impact of the pause in the interest rate increase cycle of the Fed has somewhat weakened by cautious actions of the ECB, which was faced with the problems of the eurozone economy. Today, the Fed is expected to maintain its base interest rate unchanged. Expectations of interest rate cuts increased after the production data came out weaker than expected.


At the same time, the dollar on Wednesday rose against the Australian dollar, as well as the Canadian dollar and the Japanese yen despite the gloomy prospects. This is partly due to its attractiveness as a safe-haven asset, after the US authorities expressed concern that China refuses to comply with the agreements reached at the trade negotiations. The Australian dollar on this news immediately went to a decline. Otherwise, most currencies remain within the usual trading ranges until the announcement of the Fed decision. Most likely, the dollar will not decline much in price following the Fed meeting since the market has already won back the regulator's decision to keep rates at the same level.


The material has been provided by InstaForex Company -