It looks that the fed is still possessed by the labor market losing jobs until now keeping its phrase of keeping the interest rate for an extended period of time warranted by low inflation pressure. The greenback came under pressure with no opposing voting but Hoening again who is still preferring taking a tightening action. The decision of keeping the interest rate unchanged between 0 to .25% was widely expected and it could keep the US stocks creeping up pace from falling. DOW could add another 43 points looking for January high at
10729. The investors' risk appetite has been supported by Fed's keeping this accommodative monetary stances further putting pressure on the greenback supporting the gold as a mirror of inflation in this time of suffering owes from the bonds markets amid credit downgrading which can give the gold another competitive feature versus the bonds which started to pay the cost of the governmental rescue plans and injecting liquidity in the recent 2 years into the nerves of the economy by increasing its stimulating spending, tax cuts and easing the monetary policies for spurring the investment and moving the economy out of the recession after the credit crisis.The worries about the Greek debt have calm down as the market is waiting for an expected unwarranted financial support from the other EU member for capping this problem from spreading in the Euro zone which is actually facing a downgrading of its countries creditability as Moody's warned about the triple A crediting countries in the beginning of this week with the current slow economic recovery in Europe comparing with US and the debt which is still accumulating in several countries like Greece, Spain and Portugal and should be faced with the deficit to GDP ratio average is at 6%, while it should be below 3% on Maastricht treaty of the Euro area. The single currency could get back above 1.37 again versus the greenback underpinned by optimism of a joint European financial support to come to Greece and increasing of the market risk appetite after the fed's softer language than expected which suggests keeping the interest rate at its current low to the second half of this year unchanged.
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FX Consultant Walid Salah El Din E-Mail: snipped-for-privacy@fx-recommends.com