Yesterday’s Fed Chairman Ben Bernanke has unleashed the power of the central bank to buy unlimited amounts of Treasury and mortgage- backed securities in a bid to end a 4-yesr long period of unemployment above 7.5% and support the economy. The central bank said yesterday it would keep purchasing securities at the rate of $85 billion a month as the economy paused because of temporary forces including bad weather conditions.
The euro approached to the level of 1.36 without hitting it, along with the Fed’s announcements. But it decreased slightly at the moment, though without losing its medium-term uptrend. Only a break of 1.35 may change the course.
The pound, which rose to 1.5840 early in the European session, has lost positions again and is heading back to multi-week lows, which could be reached on Friday. The medium-term target for the GBP/USD is at 1.5350.
As for the yen, which has been falling to new lows every day for two years and a half, has recovered modestly positions right now, but it is mostly a movement correction, which seems to have support for many hours. The euro was little changed at 123.47 yen after gaining to 123.86 yesterday, the strongest since May 2010. The dollar traded at 91.04 yen.
Ending the month, the day's agenda includes reports typical of this time, as the figures of income and personal spending in the United States are published at 8:30 Eastern. At the same time the Weekly unemployment claims, which on Thursday fell below expectations and at 9:45 is the turn of the Chicago PMI.