EURUSD is steadily rising after the April meeting of the US Federal Reserve System.
On Thursday afternoon, the major currency pair is keeping its positive momentum that started the day before. The current quote for the instrument is 1.2119.
During its April meeting, the US Fed unanimously decided to keep its benchmark rate intact at 0-0.25%. In addition to that, the regulator kept other aspects of its monetary policy unchanged as well: it will continue to purchase bonds at a rate of $120 billion a month.
In the comments, the Fed said that it was going to continue buying bonds until the country’s GDP and inflation reached their targets. To do this, the regulator would use all available tools. According to its estimates, economic growth and employment had generally improved, while the financial environment remained pretty “soft”. Inflation rose a bit and would continue growing but only because of temporary factors. The economic sectors that were damaged by the coronavirus pandemic are recovering but even considering this, risks for the economic outlook didn’t go anywhere.
Like the Fed Chairman Jerome Powell said in his speech, the country’s economy was still pretty far away from a complete recovery – it was still rather unstable and would improve slowly.
In Powell’s opinion, the time for spotting to purchase bonds hadn’t come yet. The coronavirus pandemic is still raising a lot of concerns but the aggressive vaccination campaign should help everyone to get back to normal lives in the nearest future.
As for inflation, Powell said that the Consumer Price Index would continue rising before slowing down a bit, and it was rather unlikely that it would improve on an ongoing basis.
As a result, the tone was rather restrained and soft, thus putting additional pressure on the “greenback”.