New York inherited the dollar on its lows this morning with traders trying to adsorb very large offers at 1.4920. Unable to take out 1.4920, there was some modest backing and filling but prices barely dipped to 1.4870. consolidation was the watchword until the FOMC surprised the market on the dovish side, saying some members favored adding to the MBS asset purchase program (QE). EUR/USD was quickly ramped up through 1.4946 but stalled ahead of 1.4950 barriers.

Stocks went out close to their highs, commodities ended firmer and commodity currencies were well supported in US trade. AUD reached 0.9157 early and spent the balance of the session consolidating. USD/CAD fell to a new 14 month low at 1.0251.

Cable was choppy, bouncing above 1.6000 in London but running into very heavy sales from central banks and “smart money” above 1.6000 early in the New York session. Unconfirmed talk that a MPC policymaker said more QE would be considered in November helped weigh on the pound.

USD/JPY was choppy, supported by buying from a sovereign wealth fund early before dipping into the 89-teens at midday in New York. US investors were steady buyers on dips into the 89.20s. The BOJ meets tonight and the Tankan is due as well, so caution was high among dealers.