Markets await the Fed's monetary policy decisions, followed by a press conference of the Bank's governor to comment on the decisions, which will have a strong impact on the movements of the US dollar, other currencies & commodities.

- There is more than a scenario for the Fed's decisions, the most important one is the very positive scenario for the U.S. dollar, which is the Bank's interest rate hike of about 100 bps and the hint of further interest rate hikes strongly if inflation continues to rise, and this scenario strengthens the U.S. dollar.

- The second scenario is for the Fed to hike interest rates by about 75 bps, bringing interest rates to 2.50%. The Fed may also assert that the option of tightening monetary policy further will depend on future economic data, especially as fears of a recession reinforce the economy due to the acceleration of interest rates, and this scenario may have a temporary positive impact on the dollar.

Equities:

- In Wall Street, US stocks were sharply lower, with Nasdaq down more than 1%, as a profit warning by Walmart dragged down retail shares and fueled fears about consumer spending. Walmart shares had fallen 8%. Amazon was among the biggest drags on the Nasdaq and S&P 500 & dropped 5.1%. Microsoft was down 3.4% and Alphabet was down 2.9%, while Coca-Cola gained 1.9% after the company raised its full-year revenue forecast & McDonald’s rose 3% . The S&P 500 fall 45.79 points, or 1.15%, to 3,921.05.

- The Dow Jones Industrial Average fall 92 points, or 0.29%, to 31,805, and the Nasdaq Composite declined 129 points, or 1.05%, to 12,171.4.

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Currency Market:

The Euro was again among the weakest performers among the dollar’s rivals, with EUR/USD flirting with 1.0100. GBP/USD held above 1.2000, while the AUD/USD settled at 0.6935.

The USD/CAD pair advanced amid weaker oil prices, trading near 1.2890.

Save-haven currencies saw little activity, with USD/CHF steady around 0.9620 and USD/JPY now trading at 136.75.

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Commodities: Gold

Gold price is displaying back and forth moves in a narrow range of $1,714 -$1,724 an ounce as investors are awaiting the announcement of the fourth consecutive interest rate decision by the Fed.

The yellow metal has displayed a complete volatility contraction, which indicates that the announcement of US monetary policy is the decisive factor in determining the direction of gold prices during the coming period.

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Commodities: Oil

Oil prices stabilized on Wednesday as data showing a larger than expected drop in US crude inventories dispelled concerns about weak demand. The American Petroleum Institute said US crude stocks fell by 4 million barrels last week.

Brent crude futures recorded $104.55 a barrel, up 15 cents, or 0.1%. WTI crude rose 27 cents, or 0.5%, to $95.25 a barrel.
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