The US dollar index was relatively unmoved as traders waited for the FOMC decision. The committee, started the meeting yesterday, and is expected to leave rates unchanged. It is also expected to give its review of the economy and guidance on whether it will raise interest rates this year. In previous meetings, the bank has announced that it will likely not hike rates today. In anticipation of the decision, Donald Trump sent a tweet asking the committee to lower interest rates.
The kiwi dropped slightly today after the country released weaker jobs numbers. In the first quarter, the New Zealand participation rate declined to 70.40% from the previous 70.90%. The employment change in the quarter dipped by 0.2%, which was lower than the expected gain of 0.5%. The labor cost index rose by an annual rate of 2%, which was higher than the expected 2.1%. On a positive note, the unemployment rate improved slightly to 4.2% from the previous 4.3%.
The sterling rose slightly ahead of key economic numbers. In April, the national housing price index is expected to rise by 0.7% and at a MoM rate of 0.1%. The manufacturing PMI is expected to decline slightly from 55.1 to 53.2. Mortgage lending in March is expected to grow to £3.54 billion from the previous £3.46 billion in February. The BOE consumer credit is expected to have dropped to £1 billion from the previous £1.14 billion.
EUR/USD
The EURUSD pair jumped from a low of 1.1109 and reached a high of 1.1230. It is now trading at the 50% Fibonacci Retracement level of 1.1217. This price is along the middle line of the Bollinger Bands and above the 25-day and 50-day moving averages. The RSI has stabilized along the 50s level. Today, the pair could make major movements as the FOMC releases its decision.
GBP/USD
The GBP/USD pair is trading along the 1.3040 level. This price is between the 38.2% and 50% Fibonacci Retracement level. It is also along the upper line of the Bollinger Bands while the RSI has moved above the overbought level of 70. The key points to watch today will likely be the 61.8% Fibonacci Retracement level of 1.3150 and the 23.6 level of 1.2915.
NZD/USD
The NZD/USD pair declined slightly after the weak job numbers. The pair reached a low of 0.6625, which is slightly below the 50-day and 25-day moving averages. The price is also below the important resistance line shown in green below. The RSI has moved lower, to the current level of 45. There is a likelihood that the pair will remain at these levels ahead of the US FOMC decision.
