US dollar expected to surge against the euro, pound following Fed
Frankfurt (June 18) The latest US economic data has sustained the dollar strength against its main rivals. While the EUR/USD continued to range between the resistance line at 1.3580 and the yearly lows at 1.3500, the GBP/USD remained capped by the 1.70 level, ahead the major resistance of 1,7045 (2009 highs).
The market’s focus today will be in the US Federal Reserve policy decision and even though the market has already priced in a steady further reduction in quantitative easing (QE), the Fed is also expected to change its forecasts which could impact the dollar.
As Kathy Lien, Managing Director at BK Asset Management noted, there could be three potential adjustments from the Fed: ‘Lower unemployment rate, higher Inflation and weaker gross domestic product.’