FX Closing Comments

Price action in the FX pairs has been subdued in recent sessions ahead of tomorrow's Fed meeting. As a quick review: markets are very confident of another .25% upward move, while there exists an outside chance of a .5% move. A half-point move would likely cause a great deal of volatility. Baring this, if the expected 25-pt move is announced, attention will shift to the commentary, with many analysts expecting a hawkish tone in response to recent inflationary signals. Also be on the look-out for an upward revision to Q1 GDP tomorrow, which would imply a faster pace of growth and a higher amount of inflation than previously thought.