Market Roundup
•US central bank cuts rates by a quarter of a percentage point
•Fed Governor Miran, Kansas City Fed President Schmid dissent
•Policy decision was made in the absence of key government data
•Fed's balance sheet drawdown halted
•Canada BoC Interest Rate Decision 2.25%, 2.25%forecast,2.50% previous
•US Pending Home Sales (MoM) (Sep) 0.0%, 1.6% forecast,4.2% previous
•US Pending Home Sales Index (Sep) 74.8,74.8 previous
•US Crude Oil Inventories -6.858M, -0.900M forecast,-0.961M previous
• Fed Interest Rate Decision 4.00%, 4.00% forecast,4.25% previous
Looking Ahead Economic Data(GMT)
•23:50 Japan Foreign Bonds Buying -669.7B previous
•23:50 Japan Foreign Investments in Japanese Stocks 752.6B previous
•00:00 New Zealand ANZ Business Confidence (Oct) 49.6 previous
•00:00 New Zealand NBNZ Own Activity (Oct) 43.4% previous
•00:30 Australia Export Price Index (QoQ) (Q3) -4.5% previous
•00:30 Australia Import Price Index (QoQ) (Q3) -0.3% forecast,-0.8% previous
Looking Ahead Events And Other Releases(GMT)
• 02:30 Japan BOJ Gov Ueda Speaks
• 02:30 Japan BoJ Monetary Policy Statement
•03:00 Japan BoJ Interest Rate Decision 0.50% forecast ,0.50% previous
Currency Summaries
EUR/USD : The euro edged lower on Wednesday as markets absorbed the Federal Reserve’s latest policy move and turned their attention to the upcoming European Central Bank (ECB) decision. The Fed cut rates by 25 basis points and announced the end of its $6.6 trillion balance sheet runoff, citing tightening liquidity, declining bank reserves, and limited data visibility amid the ongoing U.S. government shutdown.Meanwhile, the ECB is widely expected to keep interest rates unchanged for a third straight meeting later this week, as inflation continues to cool and the eurozone economy shows tentative signs of improvement. Inflation has hovered near the 2% target in recent months, underscoring the bloc’s resilience to U.S. President Donald Trump’s tariff measures.Still, ECB policymakers face persistent challenges, including rising French borrowing costs amid political instability and the lingering risk of renewed trade tensions, which could test the region’s fragile recovery. Immediate resistance can be seen at 1.1662(50%fib), an upside break can trigger rise towards 1.1728(Oct 17th high).On the downside, immediate support is seen at 1.1561(61.8%fib), a break below could take the pair towards 1.1523(Lower BB).
GBP/USD: The pound dipped on Wednesday as U.S. dollar extended gains after Federal Reserve Chair Jerome Powell dampened expectations for another U.S. interest rate cut by the central bank in December. The Fed cut rates by 25 basis points, noting the limited data visibility due to the current U.S. government shutdown, and said it is ending the drawdown of its $6.6 trillion balance sheet, also known as quantitative tightening (QT) amid evidence that money market liquidity conditions have begun tightening and bank reserve levels are dropping.Markets were pricing in a roughly 85% chance of a December cut, which stumbled to about 65% following Powell's comments, according to CME's FedWatch Tool. Sterling was last down 0.9% against the dollar at $1.3151 and reached $1.3137, its lowest since May 12.Immediate resistance can be seen at 1.3310(38.2%fib), an upside break can trigger rise towards 1.3355(SMA 20).On the downside, immediate support is seen at 1.3169(23.6%fib), a break below could take the pair towards 1.3132(Lower BB).
USD/CAD: The Canadian dollar surrendered its earlier gains against the U.S. dollar on Wednesday after the Federal Reserve refrained from hinting at another rate cut in December, offsetting the Bank of Canada’s earlier hawkish tone. The Fed lowered interest rates by 25 basis points to a range of 3.75%–4.00%, as expected. However, Chair Jerome Powell said at his press conference that another cut in December is “not a foregone conclusion,” lifting the greenback. Earlier in the day, the Bank of Canada trimmed its benchmark rate by 25 basis points to 2.25%, in line with expectations, while signaling that policy is now appropriately positioned to maintain inflation near target and support the economy amid disruptions from the U.S.-led trade conflict. The loonie was trading nearly unchanged at 1.3945 per U.S. dollar after touching its strongest level since September 30 at 1.3889. Immediate resistance can be seen at 1.3952(Daily high), an upside break can trigger rise towards 1.4000(Psychological level).On the downside, immediate support is seen at 1.3907(50%fib), a break below could take the pair towards 1.3879(Lower BB).
USD/JPY: The U.S. dollar strengthened on Wednesday after Fed Chair Jerome Powell dismissed market expectations for another rate cut in December, following the Fed’s widely anticipated reduction this week.Meanwhile, the Bank of Japan is expected to keep rates unchanged on Thursday but reaffirm its commitment to gradually raising borrowing costs to curb further yen weakness and inflation risks. While Japan’s economy has so far absorbed the effects of U.S. tariffs, Governor Kazuo Ueda cautioned that the impact could worsen in the coming months.BOJ policymakers remain divided—hawks favor near-term hikes, while doves, including Ueda, advocate waiting for clearer data on the fallout from slowing U.S. growth and trade tensions. Most economists anticipate a rate increase either in October or December, with consensus pointing to a move toward 0.75% by the end of March. Immediate resistance can be seen at 153.08(23.6%fib) an upside break can trigger rise towards 154.00 (Psychological level) .On the downside, immediate support is seen at 151.76 (38.2%fib) a break below could take the pair towards 150.67 (50%fib).
Equities Recap
Europe's STOXX 600 was muted on Wednesday as investors awaited the U.S. Federal Reserve's rate decision later in the day, while parsing through a raft of corporate earnings.
UK's benchmark FTSE 100 closed up by 0.61 percent, Germany's Dax ended down by 0.64 percent, France’s CAC finished the day down by 0.19 percent.
U.S. stocks were mixed on Wednesday, with the Dow slipping and the S&P 500 ending flat, as Fed Chair Jerome Powell downplayed the likelihood of another rate cut in December following the latest policy easing.
Dow Jones closed down by 0.15 percent, S&P 500 ended flat by 0.00 percent, Nasdaq finished the day up by 0.55 percent.
Commodities Recap
Gold prices trimmed earlier gains on Wednesday as investors weighed Fed Chair Jerome Powell’s remarks on the policy outlook, even after the central bank delivered a widely expected 25-basis-point rate cut.
Spot gold was up 0.3% at $3,964.39 per ounce, as of 3:10 p.m. ET (1910 GMT), after rising as much as 2% earlier in the session.U.S. gold futures for December delivery settled 0.4% higher at $4,000.7 per ounce.
Crude prices rose on Wednesday as U.S. stockpiles fell more than anticipated and optimism grew following President Trump’s upbeat remarks on his meeting with China’s leader.
Brent crude futures rose 52 cents, or 0.8%, to settle at $64.92 a barrel, while U.S. West Texas Intermediate crude futures gained 33 cents, or 0.6%, to close at $60.48.
