Dollar Bulls are Still in Control, USD/CAD and AUD/USD now in the Spot Light

The U.S stock market inched higher yesterday, closing with an average gain of 0.2%, after the Fed released its important interest rate decision. While some were expecting a more hawkish statement, market participants managed to read between the lines, understanding that the Fed is now acknowledging the recent economic rebound. Even though the Fed stated that they intend to maintain a low rate policy, the bank touched recent developments in the job market and financial markets, mentioning minor improvement.

Prior to the rate decision, economic data strengthened investor’s thoughts as the housing sector showed minor improvement with building permits rising to 0.58m, from a prior 0.55m. Furthermore according to the U.S Census Bureau, total housing starts rose 8.9% percent in November following a 10.1% decline in October. The increase was mainly attributed to a jump in multi-family component of the series.

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