Having just adopted employment and inflation targets at the December FOMC meeting, expect the Fed to adopt a wait and see (and print) attitude at its first meeting in the new year. Though there has been some improvement in the employment situation and the housing market we are miles away from Fed shifting its tone.
Status quo from the Fed is favorable euro as the ECB remains the tightest major central bank (and getting tighter as LTRO is paid back) as compared to the Fed, BOJ or BOE. Good for EUR/USD and the crosses.
