The euro rallied yesterday against all of the major currencies. The euro gained about 150 pips vs. the U.S. dollar, and the EUR/USD has reached the 1.4055 level as of this morning. The euro gained about 100 pips vs. the British pound and about 150 pips against the Japanese yen, as well.
The euro gained yesterday as the U.S. Federal Reserve began a two-day meeting regarding a possible stimulus to the economy. The Fed is expected to issue a statement by the end of the meeting, and investors expect it to include a large bond-buying program to support the sluggish U.S. economy. This is expected to spur inflation, and to weaken the greenback. As a result, the euro, which is the dollar's greatest rival, is strengthening, despite resurgent worries about the euro-zone's more indebted countries such as Greece, Spain, Ireland and Portugal.
As for today, there aren't any significant news releases scheduled from the euro-zone. Traders are advised to focus on the major publications from the U.S. and the British economies, as these are likely to have a great impact on the euro as well. In addition, the U.S. Congressional Elections are likely to affect all markets today, and traders should follow the results.
