Fed Chairman BERNANKE's SPEECH on exit strategy will be released to the media at 15:00 GMT, ahead of which the USD is strengthening. Any signs or hints towards more clarity of an exit strategy will boost the US dollar. Bernanke is expected to list the various ways the Fed may start to withdraw liquidity prior to raising rates such as (i) paying interest on reserves (ii) reverse repos (iii) asset sales. There could be some short term USD decline in the event Bernanke reiterates that rates will stay low for considerable period; but the mere fact that Fed is addressing exit strategy while ECB is expected to extend liquidity could be positive for the greenback.
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