Forex Today: The Fed smashes the dollar

FXStreet Team FXStreet

What you need to know on Thursday, March 18:

The dollar plummeted with the US Federal Reserve decision. As widely anticipated, the central bank left rates and quantitative easing unchanged. The Fed’s Summary of Projections showed on Wednesday that four policymakers see a lift-off in the fed funds rate from zero in 2022, compared to only one policymaker in December's publication. Additionally, the number of policymakers who see a lift-off in the fed funds rate from zero in 2023 rose to seven from five in December.

The yield on the benchmark 10-year Treasury note soared to 1.689% ahead of the Fed, but trimmed most of its intraday gains ahead of the close, ending the day at 1.64%.

Wall Street ended in the green, after a soft start to the day. The DJIA and the S&P closed at record levels after the Fed reaffirmed its ultra-loose monetary policy.

EUR/USD approaches 1.2000, while GBP/USD trades around 1.3960, cautiously bullish ahead of BOE’s Monetary Policy decision on Thursday. Commodity-lined currencies were the best performers, with AUD/USD above 0.7800 and USD/CAD at fresh yearly lows around 1.2400. The USD/JPY pair is little changed down to 108.80.

Gold advanced to 1,750, ending the day at $ 1,744 a troy ounce. WTI was little changed, with the barrel trading at $64.50.

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EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.