THE TAKEAWAY: A rally in the Dollar earlier in the weak lost momentum as attention turned to the Federal Reserve meeting and poor GDP figures weighed on the currency.
The US Dollar opened higher after the weekend and rallied early in Monday trading as investors awaited the Durable Goods data set to be released later in the day. Strong goods data saw investors seek more risky assets and as they sought to get out of their Dollar positions, the currency weakened.
Consumer Confidence was the next piece of data that investors eyed and as the FOMC meeting approached, the figure might have set the tone for the outlook on the Federal Reserve’s Quantitative Easing program. Consumer Confidence for the US disappointed, and investors sold their Greenback positions as the data confirmed speculation that the Fed was likely to remain dovish on monetary policy.
Across the Atlantic, European Consumer Confidence came in line with expectations which saw the Euro rally sharply against the US Dollar, forcing the safe haven currency to lower levels. The Greenback fell further, as US GDP came in worse than expected and the FOMC saw growth stagnation for the world’s largest economy.