Markets Snapshot
Dollar Mildly Lower after Weak CPI, FOMC Awaited Dollar drops mildly in early US session after weaker than expected inflation data. But loss is so far limited as markets await FOMC policy decision. Headline CPI slowed to 1.7% yoy in August versus expectation of 1.9% Yoy. Core CPI also slowed to 1.7% yoy, versus expectation o 1.9% yoy. Later today, FOMC is expected to reduce a further USD 10b in the QE program, leaving a final USD 15b which will be removed at the October meeting. We expect to see the statement modified to signal clearly that the QE would end in October. The biggest question is whether FOMC would change the language in the accompanying statement to reflect that rate hike is nearing. To be specific, Fed noted that rates would stay near zero for a "considerable time" after QE ends. And markets are wondering if Fed would drop "considerable time" and vote pattern for such change or not. Fed will also release updated economic projections. There could be upward revision in GDP forecast and downward revision in unemployment rate. Full Report Here...
Featured Technical Report
GBP/USD Mid-Day Outlook Daily Pivots: (S1) 1.6186; (P) 1.6249; (R1) 1.6336; More... GBP/USD rises to as high as 1.6350 so far today as the recovery from 1.6051 continues. Outlook remains unchanged though as such recovery is viewed as a correction only. While further rise cannot be ruled out, we'd expect upside to be limited by 1.6534 support turned resistance and bring fall resumption. Below 1.6161 minor support will turn bias back to the downside for 1.6051 first. Break will extend the decline from 1.7190 through 50% retracement of 1.4813 to 1.7190 at 1.6002 to 61.8% retracement at 1.5721. Read more...

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GMT Ccy Events Actual Consensus Previous Revised 22:45 NZD Current Account Balance Q2 -1.07B -1.04B 1.41B 1.47B 00:30 AUD Westpac Leading Index M/M Aug -0.10% -0.10% 08:30 GBP BoE Minutes 08:30 GBP BoE Official Bank Rate Votes 2--0--7 2--0--7 2--0--7 08:30 GBP BoE Asset Purachse Facility Votes 0--0--9 0--0--9 0--0--9 08:30 GBP Jobless Claims Change Aug -37.2K -29.7K -33.6K -37.4K 08:30 GBP Claimant Count Rate Aug 2.90% 3.00% 08:30 GBP ILO Unemployment Rate (3M) Jul 6.20% 6.30% 6.40% 09:00 CHF ZEW (Expectations) Sep -7.7 2.5 09:00 EUR Eurozone CPI M/M Aug 0.10% 0.10% -0.70% 09:00 EUR Eurozone CPI Y/Y Aug F 0.40% 0.30% 0.30% 09:00 EUR Eurozone CPI - Core Y/Y Aug F 0.90% 0.90% 0.90% 12:30 USD CPI M/M Aug -0.20% 0.00% 0.10% 12:30 USD CPI Y/Y Aug 1.70% 1.90% 2.00% 12:30 USD CPI Core M/M Aug 0.00% 0.20% 0.10% 12:30 USD CPI Core Y/Y Aug 1.70% 1.90% 1.90% 12:30 USD Current Account Balance Q2 -99.5B -$115.0B -$111.2B -102.1B 14:00 USD NAHB Housing Market Index Sep 59 56 55 14:30 USD Crude Oil Inventories -1.0M 18:00 USD FOMC Rate Decision 0.25% 0.25%
Orders and Options Watch
US Session: Orders and Options Watch EUR: The single currency remained confined in narrow range, offers at 1.2960 were filled but sell orders are still seen at 1.2975-85 and 1.3000, more offers are noted at 1.3025 (stops above), 1.3035 and 1.3050-60, selling interest is expected at 1.3085, 1.3100-10 and 1.3035. On the downside, bids remain at 1.2920-25 and 1.2900-10, buy orders are still seen at 1.2885-95 and 1.2850-60 (stops below), buying interest is tipped at 1.2825, 1.2800 and 1.2785, fresh demand is expected at 1.2750 and 1.2725, mixture of bids and stops is located at 1.2700. Read more...
Forex Trade Ideas
Trade Idea Update: USD/CHF - Buy at 0.9290 Although the greenback has rebounded again after yesterday's brief fall to 0.9300 and gain to 0.9360 cannot be ruled out, break of 0.9373-80 is needed to signal recent upmove has resumed for a retest of last week's high at 0.9396, above there would extend headway to 0.9417 (61.8% projection of 0.9126-0.9336 measuring from 0.9287 and 50% projection of 0.9176-0.9380 measuring from 0.9315) but loss of upward momentum should limit upside to 0.9440-50 Read more... Trade Idea Update: EUR/USD - Sell at 1.3010 Although the single currency retreated after yesterday's brief rise to 1.2995, near term upside risk remains for the erratic rise from 1.2859 to bring retracement of recent decline to 1.3000-10 (50% Fibonacci retracement of 1.3160-1.2859) before prospect of another retreat, below 1.2920-25 would bring test of 1.2909 but a sustained breach below latter level is needed to signal the rebound from 1.2859 has ended and bring further weakness to 1.2880-85, then retest of 1.2859