FEDERAL OPEN MARKET COMMITTEE SPEAKERS HELP TO SUPPORT THE U.S DOLLAR

FOMC SPEAKERS

Following the Federal Reserve's decision to raise rates, a number of FOMC members this week gave scheduled speeches, focusing on the current shape of the U.S economy.

During New York Fed President William Dudley speech, he said that sustained job gains in the U.S will eventually trigger higher price growth, and he remained unconcerned about recent low U.S inflation.

Speaking on Tuesday, Dallas Fed President Robert Kaplan said he was not calling for a pause in rate increases yet, whilst Chicago Fed President Charles Evans said the FED should slowly raise interest rates, however, he remained optimistic about the U.S economy and employment. 

U.S DOLLAR MOVES HIGHER

Hawkish comments from FOMC voting members helped underpin the U.S dollar index this week, the euro currency moved to a new monthly low, of 1.1118 against the U.S dollar.

The dollar also remained strong against the British pound and the Swiss franc, as traders begin to factor in further rate increases from the Federal Reserve during the later half of 2017. 

RBNZ BOOST THE KIWI

The New Zealand dollar moved higher this week, after the Reserve Bank of New Zealand held the official cash rates unchanged at 1.75%, but delivered a policy statement sounded less dovish than financial market traders had expected.

Foreign exchange traders had expected RBNZ policy makers to express concern about the rising value of the New Zealand dollar at this month's meeting. Instead, the policy statement sounded upbeat on the New Zealand economy and focused on recent positive data points.

The New Zealand dollar spiked higher to 0.7275 against the U.S dollar as the statement was released.

BOE CARNEY AND HALDANE SHOCK STERLING

Bank of England Governor, Mark Carney, this week started sterling on a roller coaster ride, as he delivered his delayed Mansion House speech. Mark Carney said that 'Now was not the time to raise UK interest rates'. The news sent the British pound sharply lower, with the GBPUSD pair hitting a three-month trading low against the U.S dollar, at 1.2589.

The following day, Bank of England chief economist, Andy Haldane, shocked financial markets again, when he commented that he was is ready to vote for an increase in UK interest rates "relatively soon".

The news came as a surprise to financial markets, as Andrew Haldane has long been considered one of the more dovish members of the Monetary Policy Committee.

The statement moved the British pound away from three-month trading low's against the U.S dollar, hitting an intraday high of 1.2710.