US rate hike is on the table

Currency market is being driven by the news from the United States these days. The Federal Reserve meeting on Wednesday didn’t bring us any changes in monetary policy, but revealed some hawkish ideas inside of the Fed. The Committee opened the door for a rate hike on the December 16 meeting. As a result, the US Dollar surged in all the currency pairs with EUR/USD falling to 1.0900.

On Thursday, US released the advance Q3 GDP. Economy grew by 1.5% in three months, according to the preliminary estimates. This is down from +3.9% in Q2 and slightly below the +1.6% forecast, but confirms the moderate economic growth mentioned in the FOMC statement. As a result, data didn’t put any pressure on the US currency.

On Friday, we’ll be watching a new bunch of data in States: Employment Cost index and Personal Consumption Expenditures. Figures are expected to show slight improvement over the past period and give more support for the US currency.

On the next week, the market will be focused on the October NFP on Friday, November 6. Traders are recommended to keep an eye on the news coming out from States as the December policy decision will be data-dependent.

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