Daily Afternoon Report 27/01/2016

Daily Afternoon Report 27/01/2016

The dollar moved lower against the other major currencies today, as investors became more cautious ahead of the Federal Reserve’s policy statement due later in the day. The Fed is expected to keep interest rate on hold at the conclusion of its two-day policy meeting later today after raising interest rates for the first time in almost a decade in December.

Investors are looking to the Fed policy statement for any indication that the bank is considering slowing the path of interest rate increases this year after recent global financial market turmoil.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.29% at 98.78.

Market participants are also cautious ahead of the conclusion of the Bank of Japan’s meeting on Friday. Most analysts are expecting no changes to monetary policy, but recent weakness in economic reports, as well as comments by central bank officials have fueled expectations for more easing this year.

Elsewhere, the commodity-related Canadian dollar found some support after oil prices rose above $32 a barrel on Tuesday, but they resumed their downward trend on Wednesday.

Earlier today, the Australian Bureau of Statistics said the consumer price index rose 0.4% in the fourth quarter, beating expectations for an uptick of 0.3%, after a 0.5% increase in the three months to September. Year-on-year, consumer prices rose 1.7% in the last quarter, exceeding expectations for a 1.6% gain.