Forexlive Americas FX news wrap: FOMC keeps rates unchanged and reiterates low rate.

Author: Greg Michalowski | Category: News

Forex news for North American trading on July 29, 2020 

The FOMC kept rates unchanged as per expectations and Fed Powell reiterated - and even enhanced - his previous statement that the Fed is not even "thinking about thinking about, thinking about raising rates" (He added a "thinking about".  Get the idea?). Some highlights from his presser included:

  • continued fiscal, monetary policy needed to help the economy improve
  • for some businesses direct fiscal support needed
  • he commented that the Fed has not done as much lending as originally thought
  • pandemic represents bigger shock to economy in living memory
  • the Fed is saying early results of early fiscal action, but will need more support from Congress
  • fiscal policy can support in ways that that the Fed cannot
  • burden weighing heavily on lower income workers
  • there has been a stall in the recovery
  • our job is not to plan for the upside case
  • Some humility is appropriate in forecasting where the economy is headed. It looks like we're seeing a slowdown in the rate of growth. The timing of it seems to be related to the spike in cases in mid-June. We're just going to have to wait and see
The dollar moved lower earlier in his presser but did reach a limit and moved back higher.  

Nevertheless, a number of currencies reach new 2020 (and beyond) highs vs. the US dollar including the EUR (highest level since September 2018), CHF (highest level since May 2015), and the AUD (highest level since April 2019). The GBP reached it's highest level since March 10, 2020 and the JPY reached its highest level since March 13, 2020.

Although the dollar is off its lowest levels of the day heading into the close, the greenback is still the weakest of the major currencies. The strongest currency today was the EUR with the EURUSD up 71 pips (0.61% move) on the day. The EURJPY is up 64 pips (up 0.52%) and trading just off the highs for the day.

Forex news for North American trading on July 29, 2020 
In other markets,
  • Spot gold is trading up around $10 or 0.5% at $1968.60 silver has moved the other way. Silver is moving the other way. It is down -$0.16 at $24.23.
  • WTI crude oil futures are trading up $0.26 or 0.63% at $41.31
In the stock market, the big tech firms CEOs from Facebook, Amazon, Alphabet, and Apple testified on Capitol Hill regarding anticompetitive practices. Of course there was lots of afinger-pointing by congressional members, but overall the leaders of the firm's held their ground. The NASDAQ index closing up 1.35% is a testament to their success (the testimony is still ongoing).
The final numbers in the stock market today are showing:
  • S&P index up 40.0 points or 1.24% at 3258.44
  • NASDAQ index up 140.85 points or 1.35% at 10542.94
  • Dow industrial average up 160.29 points or 0.61% at 26539.53
PayPal earnings-per-share beat expectations at $1.07 vs. $0.88. Revenues were also higher at $5.26 billion vs. expectations of $4.99 billion. 

Qualcomm earnings-per-share also beat expectations at $0.86 vs. $0.71 expected. Revenues totaled $4.89 billion vs. $4.81 billion estimate

Both PayPal and will come stocks are up in after-hours trading.

Tomorrow Facebook, Amazon, Apple, and Alphabet will release their earnings. Facebook was scheduled to release today but due to the testimony, it was postponed to Thursday

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