With the Fed and the Bank of Japan announcing in the next couple of days, financial markets have moved into consolidation mode, with little direction on key markets such as the euro, Cable and gold. Wall Street has also consolidated with the S&P 500 closing +0.1% higher last night. Asian markets have been mixed although the Nikkei was +1.7% higher). European markets are mildly higher in early moves.
In forex the yen weakness is the big mover, helping Dollar/Yen sharply higher, whilst the Aussie and Kiwi are also slightly weaker. However with the euro holding its own there is a limit to the dollar strength ahead of the Fed. With the slight dollar strength, commodities are all off a touch with gold and oil both weaker.
Traders will be looking towards the first reading of UK Q2 GDP at 0930BST which is expected to be +0.5% (up from the +0.4% last quarter) with the impact of Brexit only a few days right at the end of the quarter so barely likely to feature. There is also the US Durable Goods Orders at 1330BST which are expected to be +0.3% for month on month core reading. Pending home sales are at 1500BST and are expected to improve by 1.9% on the month. However the big moves of the day could come with the FOMC statement which is released at 1900BST.