USD Slides After Fed, SNB, BoE and BoJ Take Their Turn

Fed Keeps Policy Unchanged, But Stays Ready to Do More

The US dollar continued sliding against the other G10 currencies on Wednesday and during the Asian session Thursday. It underperformed the most against NOK, SEK, GBP and EUR in that order, while it lost the least ground versus JPY and CHF.

EUR/USD — Technical Outlook

EUR/USD came under some buying interest in the first half of this week and it continues to be of interest for the bulls. This morning, the pair is seen climbing higher, breaking above some key resistance areas, one of which is yesterday’s high, at 1.2212. Also, the rate is trading well above its short-term tentative upside support line drawn from the low of November 4th. We will take a bullish approach, at least for now.

SNB, BoE and BoJ Take the Central Bank Torch

As for today, the central bank torch will be passed to the SNB and the BoE. Kicking off with the SNB, when they last met, policymakers of this Bank kept their policy untouched, reiterating that the Swiss franc is highly valued and that they remain ready to step up FX-market interventions when deemed necessary. Since then, the Swiss franc has gained notably against the US dollar, but stayed relatively unchanged against the euro. In our view, bearing in mind that SNB pays more attention to the EUR/CHF exchange rate, officials are unlikely to strengthen their intervention language. We believe that they will keep their policy unchanged and that the statement will be more or less a repetition of the previous one.

GBP/JPY — Technical Outlook

GBP/JPY continues to rally, after gapping to the upside o Monday morning. The pair is trading above a steep short-term tentative upside line, marked by the low of December 11th. As long as that upside line remains intact, we will stay positive with the near-term outlook.

As for the Rest of Today’s Events

During the European session, we get Eurozone’s final CPIs for November, but as it is always the case, they are expected to confirm their preliminary estimates.

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