The FX market was quiet overnight, as traders are waiting for the Fed rate decision tonight. There were plenty of data releases out of Japan overnight, but they had little impact on markets. USD/JPY consolidated in a 115.00-33 range and flows were light.
The Euro slightly rose overnight, from 1.0620 to 1.0640 against the Dollar. Strong resistance is seen at 1.07, while support can be expected at 1.0550 and 1.0510. GBP/USD fell to 1.2640 in Asia, after it was rejected at 1.2730 resistance yesterday.
The commodity currencies are mixed – the Aussie and Canadian $ are down against the USD, while the NZD appreciated. AUD/USD fell from 0.75 to 0.7480, and the pair is likely to come under increased pressure if it does not clear 0.7500/20 resistance soon.
The main event today is the Fed rate decision. The central bank is expected to increase rates by 25 bps, the second rate hike after the end of the QE3 programme.
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