Market news

15 December 2021

Forex Today: Fed delivered as expected, stocks rallied on relief

What you need to know on Thursday, December 16:

Markets participants held their breath ahead of the US Federal Reserve monetary policy decision, with the greenback firming up but without breaking any relevant level. The US central bank confirmed it will accelerate the pace of tapering, starting in January 2022. As expected, the central bank decided to leave rates on hold, and trim bond-buying by $30 billion per month.

US Federal Reserve Chair Jerome Powell noted that economic activity is on tact to expand at a robust pace this year, adding, however, that the Omicron variant poses risks to the outlook. On employment, he said that all officials think the labor market will reach maximum employment next year. About inflation, the focus remains on bottlenecks and supply constraints, although it is expected to decline closer to 2% by the end of 2022. As the presser developed, stocks found the strength to turn green, pushing the dollar back down.

The American dollar initially rallied with the headline, but turned south within Chair Powell’s press conference, ending the day lower against most of its major rivals. Powell noted that it would not hike rates before ending up tapering, cooling down speculative expectations. Stocks rallied on relief, pressuring the American currency.

The EUR/USD approached the 1.1300 level but remains below it ahead of the ECB. The European Central Bank will announce its decision on monetary policy and is widely anticipated to maintain its current policy on hold. In the previous week, there were market talks pointing out a possible extension of the financial support, despite President Christine Lagarde having repeated the Pandemic Emergency Purchase Program will end in March 2022.

 The GBP/USD peaked at 1.3282 and currently trades at 1.3260. The high was reached following the release of UK inflation data, which jumped to a record of 5.1% YoY in November.

The Australian dollar appreciated the most, now trading around 0.7170 vs the dollar, and heading into the release of Australian employment data. USD/CAD retreated to 1.2840.

Gold posted a fresh multi-month low of 1,752, recovering afterwards to settle at around 1,778. Crude oil prices advanced alongside stocks, with WTI now trading at around $71.50 a barrel.

Cardano could more than double if ADA holds support


Like this article? Help us with some feedback by answering this survey:

Rate this content
Market Focus

Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimer.

Open Demo Account
I understand and accept the Privacy Policy and agree that my name and contact details can be used by TeleTrade to contact me about the information I have selected.
23 International Awards
Have a question?

We are ready to assist you in every step of your trading experience
by providing 24/5 multilingual customer support.

Follow us

Risk Warning: Trading Forex and CFDs on margin carries a high level of risk and may not be suitable for all investors. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.72% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Prior to trading, you should take into consideration your level of experience and financial situation. TeleTrade strives to provide you with all the necessary information and protective measures, but, if the risks seem still unclear to you, please seek independent advice.

© 2011-2022 Teletrade-DJ International Consulting Ltd

Teletrade-DJ International Consulting Ltd is registered as a Cyprus Investment Firm (CIF) under registration number HE272810 and is licensed by the Cyprus Securities and Exchange Commission (CySEC) under license number 158/11.

The company operates in accordance with the Markets in Financial Instruments Directive (MiFID).

The content on this website is for information purposes only. All the services and information provided have been obtained from sources deemed to be reliable. Teletrade-DJ International Consulting Ltd ("TeleTrade") and/or any third-party information providers provide the services and information without warranty of any kind. By using this information and services you agree that under no circumstances shall TeleTrade have any liability to any person or entity for any loss or damage in whole or part caused by reliance on such information and services.

TeleTrade cooperates exclusively with regulated financial institutions for the safekeeping of clients' funds. Please see the entire list of banks and payment service providers entrusted with the handling of clients' funds.

Please read our full Terms of Use.

To maximise our visitors' browsing experience, TeleTrade uses cookies in our web services. By continuing to browse this site you agree to our use of cookies.

Teletrade-DJ International Consulting Ltd currently provides its services on a cross-border basis, within EEA states (except Belgium) under the MiFID passporting regime, and in selected 3rd countries. TeleTrade does not provide its services to residents or nationals of the USA.

Material posted here is solely for information purposes and reliance on this may lead to losses. Past performances are not a reliable indicator of future results. Please read our full disclaimer.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72.72% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Choose your language/location