Forex - Dollar Unchanged Ahead of Fed Meeting, New Zealand Dollar Jumps


The U.S. Dollar was unchanged on Wednesday as markets awaited the conclusion of the Federal Reserve’s latest meeting, while the New Zealand Dollar jumped against the dollar on a better-than-expected business confidence report.

The Fed is widely expected to hike interest rates later in the day. Markets also anticipate another rate hike before the year end, although the outlook for 2019 is less clear, according to analysts.

As well as an interest rate decision, the Federal Reserve will also serve up its summary of economic projections, outlining policymakers' expectations on economic growth, inflation and unemployment.

The U.S. dollar index, which tracks the greenback against a basket of other currencies, was unchanged at 93.73 by 11:01PM ET (03:01 GMT). The index has slipped around 3% since August.

Global trade tension remained in focus as China’s Vice Commerce Minister Wang Shouwen said Beijing would resume trade talks only if the U.S. show sincerity and not put a knife at China’s throat.

Wang then added that the two sides were set to have four rounds of talks but the U.S. went back on what they had agreed.

“In the trade dispute, China and the United States have made no real progress on having direct negotiations,” said Kumiko Ishikawa, senior analyst at Sony Financial Holdings.

“The market isn’t shifting aggressively to a risk-on mode as a result,” she said.

Meanwhile, the New Zealand dollar rose on Wednesday as September’s business confidence index from the Australia and New Zealand Banking Group came in at -38.3, compared to the ten-year low of -50.3 in August. The NZD/USD pair last traded at 0.6675, up 0.5%. The AUD/USD pair also gained 0.3% to 0.7275.

Elsewhere, the USD/JPY pair slipped 0.05% to 112.91. U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe are due to meet later today to discuss the promotion of a bilateral trade following a round of trade negotiations.

The USD/CNY pair inched up 0.1% to 6.8729 as the People's Bank of China (PBOC) set the yuan reference rate at 6.8571 vs Tuesday's fix of 6.8440.

Source: www.investing.com