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Hello everyone, today Avatrade Aihua Foreign Exchange will bring you "[Aihua Foreign Exchange Market Review]: The US dollar holds its position after the Federal Reserve meeting and pays attention to the Bank of England." Hope it will be helpful to you! The original content is as follows:
Earlier on Thursday, the dollar remained flexible against other currencies due to market evaluation of the Federal Reserve’s (Fed) policy announcement. Later that day, the Bank of England is expected to maintain its bank interest rate of 4.25%. The U.S. financial markets will continue to close to celebrate the June holiday.
As generally expected, the Federal Reserve kept its policy interest rate at 4www.avaforexcn.com.25%-4.5% unchanged after its June meeting. The revised Economic Forecast Summary (SEP) shows that policy makers still expect interest rates to be cut by a total of 50 basis points (bps) in 2025, while only 25 basis points are expected to be cut in 2026. At a post-conference press conference, Fed Chairman Jerome Powell said the tariff hike could put pressure on economic activity and push up inflation. Powell noted that they are “in a good position” to wait and learn more before considering policy adjustments. The dollar index rose slightly around 99.00 after closing flat on Wednesday.
Meanwhile, Bloomberg reported earlier Thursday, citing unnamed sources that U.S. officials were preparing for a possible crackdown on Iran in the www.avaforexcn.coming days. Similarly, the Wall Street Journal claims that U.S. President Donald Trump approved a plan to attack Iran earlier this week but wanted to wait and see if Tehran will abandon its nuclear program. The market is cautious about the growing concerns about the US's direct participation in the widening conflict in the Middle East.
Basic foreign exchange market conditions:
Swiss National Bank (SN)B) announced Thursday that as expected, the benchmark current deposit rate was cut by 25 basis points to 0% from 0.25%. After the Swiss National Bank decision, the US dollar/CHF fell from its intraday high and traded around 0.8200.
After a slight decline on Wednesday, the GBP/USD continued to move lower during Thursday’s Asian session and hit its lowest level in nearly a month below 1.3400. The pair remained stable at a little above 1.3400 in early European session, and the market awaited a policy decision by the Bank of England.
Euro/USD has difficulty gaining traction and trades near the lower limit of the weekly interval below 1.1500.
The USD/JPY is difficult to find direction, and early Thursday trade fluctuates in a narrow channel above 145.00. According to Reuters, the Japanese government plans to reduce sales of ultra-long-term bonds by about 10% from the initial plan, a rare revision of the bond plan for the current fiscal year, thus reducing overall bond issuance.
Bulle market fundamentals:
Gold prices reversed the situation when the European session fell to a one-week low. Currently trading around the $3,366-3,367 area. With mixed fundamental clues, there was almost no change on the day.
Analysis of major currency trends:
Euro: Euro/USD consolidates below 1.1630, and intraday bias remains neutral. A further rebound is expected when the 1.1372 support level is intact. Breakthrough of 1.1572 will continue the upward trend from 1.0176. The next target is a 61.8% forecast from 1.1064 to 1.1927 to 1.0176 to 1.1572. However, a breakout of 1.1372 support will indicate a short-term peak and turn down to get a deeper pullback.
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