Forex: Dollar flat, FOMC fail to move markets

By IBTimes Staff Reporter | January 27 2010 11:58 PM

FXstreet.com (London) - Dollar trade was broadly flat this session as investors showed little reaction to a priced-in FOMC decision today. Despite the more upbeat statement markets were unmoved. Market broadly however in a mood of risk aversion.

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Euro has traded sharply down, printing new lows for the year before making some recovery. As doubts over Greece ability to narrow its fiscal deficit grows, players now concerned over speed of recovery. Market has reacted strongly to the US presidents proposed banking reforms, and China and US slower than expected growth. US/China tension has also risen which could strain trade if things do not subside a little.

The broad picture for the Greenback against its major partners as we head to the Asian close is as follows: EUR/USD 1.4017/19 (-0.03%), Swissy 1.0514/19 (+0.13%), Cable 1.6187/92 (+0.12%), USD/JPY 90.33/35 (+0.37%).

Nikkei gapped up early and extended gains on the back of a weaker Yen, currently trading up over 170bps or 10434 index points. Major exporters release their YE financials in Japan soon, and market appears bullish in anticipation.

London will open likely to upside following Nikkei bullish outlook, with market players moving towards risky plays after the hawkish FED comments yesterday.

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