Forex Market News
Stocks make new highs in the US and currency trading volume sees record volumes on Scottish volatility. CLS recorded over 2,000,000 trades for a face value of 10,100,000,000,000! That is a bloody lot of zeros you say. Yes, 12 in fact, as the value was 10.1 trillion. Brokers around the world are cheering! http://www.bloomberg.com/news/2014-09-18/independence-minded-scots-reinvigorate-currency-trading.html.
Commodities take a new slide south as US assets (bonds and stocks) continue to attract investor flow. The pound also bounced, most against the euro, as the skittish Scots are seen to stay in the union and the risk hedge is unwound.
The FOMC produced little surprise. No change to its stance and the QE3 is now down to $15B/mth and will cease altogether in October. What was jumped on was the expectations of interest rates. The average expected rate (by the voting members of the Fed) rose slightly for 2015. This saw some moves in the bond market which by natural progression saw greenbacks rise too. Overnight wasn’t so strong for the dollar as most pairs, apart from Yen, won the arm wrestle.
The SNB is one to watch. They maintained the EURCHF floor of 1.2 but are concerned with disinflation. They mentioned being more aggressive, being negative interest rates. However with the success of the currency floor and the fact that they mentioned it the most I would not be surprised if they raise that floor to perhaps 1.5. Heard it here first so keep an eye on the Swissy and the SNB.