The global financial markets turn their attention to monetary policy on Tuesday, with the US Federal Reserve set to begin its two-day meeting in Washington.
The Federal Open Market Committee (FOMC) is widely expected to stand pat on interest rates when it concludes its meeting Wednesday afternoon. However, given that this is the last meeting before the fall, traders will closely monitor the language of the official statement. The FOMC has voted to raise interest rates three times since December. One additional hike is forecast this year.
Earlier this month, Fed Chair Janet Yellen told Congress that the central bank will maintain a steady hand in normalizing monetary policy. Yellen’s caution comes amid months of dismal economic data, including a sharp slowdown in inflation. Like other central banks, the Fed targets inflation at 2% annually.
A dovish rate statement on Wednesday could trigger fresh losses for the US dollar, which is trading near 11-month lows against a basket of world currencies. The dollar index (DXY) staged a mild recovery on Monday but had given up its gains at the start of Tuesday trading. Since the start of 2017, the greenback has declined more than 8% against a basket of world peers.
In economic data, IFO will release its monthly barometer of German business confidence. The business climate index is forecast to decline slightly to 114.9 in July from 115.1 the previous month. The barometers measuring current economic conditions and future expectations are also forecast to dip slightly.
In North America, the S&P/Case-Shiller Home Price Indices will be released at 13:00 GMT. The data measure the changes in home values in the world’s largest economy.
The Federal Housing Finance Agency (FHFA) will also release the housing price index at the same time.
Finally, the Federal Reserve Bank of Richmond will publish its July manufacturing index.
EUR/USD
The euro traded within a narrow range at the start of the week, as the market recent consolidated gains. The common currency has benefited from a pervasively weak US dollar and signs of stability in its domestic market. As a result, the EUR/USD is trading at multi-year highs. The pair faces immediate support at 1.1523, the 10-day SMA. On the upside, immediate resistance is located just above 1.1700.
GBP/USD
The pound was also rangebound in early-week trade, although recent movement suggests traders are buying on the dip. This suggests that cable remains supported in the mid-1.29 range even as its rally attempts north of 1.3050 remain short-lived.
WTI Oil
Oil prices returned to positive territory this week on news that Saudi Arabia was reducing crude exports. However, analysts at Credit Suisse have warned that prices will remain stuck below $60 a barrel through 2020, as an oversupplied market undermines any recovery attempt. Prices were last seen in the mid-$46.00 range. Traders should anticipate inventory data over the next two days.
General Risk Warning for FX & CFD Trading. FX & CFDs are leveraged products. Trading in FX & CFDs related to foreign exchange, commodities, financial indices and other underlying variables, carry a high level of risk and can result in the loss of all of your investment. As such, FX & CFDs may not be appropriate for all investors. You should not invest money that you cannot afford to lose. Before deciding to trade, you should become aware of all the risks associated with FX & CFD trading, and seek advice from an independent and suitably licensed financial advisor. Under no circumstances shall we have any liability to any person or entity for (a) any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to FX or CFDs or (b) any direct, indirect, special, consequential or incidental damages whatsoever.
Recommended Content
Editors’ Picks

EUR/USD holds losses below 1.0500 on Trump’s tariff uncertainty
EUR/USD keeps losses below 1.0500 in the European trading hours on Thursday. The pair suffers from a sustained US Dollar recovvery-led by US President Trump's conflicting messages on tariffs. Traders now look to the ECB Minutes, US GDP revision and Trump-speak for impetus.

GBP/USD remains depressed below 1.2700 amid US Dollar strength
GBP/USD remains depressed below 1.2700 in European trading on Thursday. Broad US Dollar strength and cautious mood, amid US President Trump's tariff uncertainty, weigh down on the pair ahead of key US macro releases and more Trump talks.

Gold falls on Trump creating more confusion about tariffs
Gold’s price faces strong selling pressure and extends this week’s correction to hit a ten-day low near $2,880 on Thursday. The leg lower comes after US President Donald Trump cast doubts and confusion during a cabinet meeting on Wednesday about what levies will be applied, when, and to which countries.

Solana Price Forecast: DTCC lists first SOL futures ETF, will it avert $130 breakdown?
Solana price tumbled from $172 to $134 this week as FTX estate’s impending token unlock looms ahead despite early gains from a new SOL ETF listing.

February inflation: Sharp drop expected in France, stability in the rest of the Eurozone
Inflation has probably eased in February, particularly in France due to the marked cut in the regulated electricity price. However, this overall movement masks divergent trends. Although disinflation is becoming more widespread, prices continue to rise rapidly in services, in France as well as elsewhere in the Eurozone.

The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.