Fed Reserves Minutes Today: Monetary Easing Could Send USD Higher

Binary Options traders: keep your eyes open for the Fed Reserves January minutes release. If there is a sign to pause monetary easing, then this could send the USD higher. If this happens, commodities such as gold, silver and copper will face a negative impact and trade lower than their current value. Watch out for American housing data, which if lower then expected, will suggest a worsening US economy and could bring down the USD value. However, if there are positive signs then this in turn would allow the US Fed to slow down further easing.

Forex

The EUR has bounced back to reach its highest point for over sixteen months against the GBP; the EUR/GBP pair reached 0.8765%. This came after the split between the Bank of England's policymakers in making a decision over further monetary easing to a level of 400 Billion GBP, from a current level of 735 billion GBP. The Bank of Englands Governor Mervyn King was in favour of further easing.

Meanwhile, the USD/GBP was at its highest level in 8 months. The pair slid by 0.76 % to 1.5309. UK unemployment data was also very negative; it’s now at 7.8% from its previous level of 7.7%. It was expected that this level would not change. The number of people claiming unemployment benefits in the UK surprisingly dropped by 12,500 in Jan against an expected drop of 5000 people claiming. The USD/JPY pair remained little changed, with a slight rise of 0.1% to 93.57.

Stocks

Corporate earnings data to come out today so investors wary to buy into stocks. The European market stocks barely moved in this European trading. French CAC 40 crept up by 0.1 %, German DAX 30 inched up by 0.2 %. Number of mergers and aqusitions in the US has risen and thus caused US stocks to close higher yesterday in US trading. Dow Jones finished up 0.39 per cent, S&P 500 was up by 0.73 % and the NASDAQ up by 0.68 per cent.

Asian stocks bouncing back. Hong Kong Hang Seng rose 0.5 %, Australian ASX/200 0.35 % and Japan Nikkei 225 up by 0.8 %. Positive export data out of Japan surpassing expectations and China moving back to positive growth even though the trade deficit hit a high.

Commodities

Gold was at its lowest value for over 5 months as investors put pressure on the commodity by technical selling. On Comex gold futures for April valued at $1592.70 troy ounce, a drop of 0.7 %. At its lowest point gold commodity touched $1590.40 troy ounce. Gold may still shrink in price, even reaching 1550. This will be affected by outcome of Fed Reserves minutes later today.

Silver for March prices fell by 0.95 % , this is a 6 month low, at USD29.14 troy ounce. Copper for Mar delivery crept down by 0.2 % to trade at USD3.641 a pound.