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Dollar Retreats Ahead of Fed Meeting

March 16, 2015 by

The US dollar was broadly weaker against other currencies, including the euro, today as Forex traders were cautious ahead of the Federal Reserve’s policy meeting that will start tomorrow. EUR/USD retreated from its daily highs, forming a double-top pattern on the 15-minute chart, but remains above the opening level as of now.

NY Empire State Index demonstrated a drop from 7.8 in February to 6.9 in March versus the predicted increase to 8.1. Still, the report said that “business activity continued to expand at a modest pace.” (Event A on the chart.)

Both industrial production and capacity utilization fell short of expectations in February. Industrial production was up just 0.1% compared to the median forecast of 0.3%. Capacity utilization was at 78.9%, below the predicted level of 79.5%. The January’s readings were revised negatively: from 0.2% to -0.3% for production and from 79.4% to 79.1% for utilization. (Event B on the chart.)

US net foreign purchases were at -$27.2 billion in January while experts predicted the exactly same reading but in a positive territory. The previous month’s reading was revised from $35.4 billion up to $39.2 billion. (Event C on the chart.)

EUR/USD for 2015-03-16

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