The whole world is just waiting to see what the Federal Reserve decides and what Fed Chairman Jerome Powell says (or doesn't say) in the press conference, Commerzbank’s FX strategist Antje Praefcke notes.

Calm ahead of the Fed meeting

“Hardly much will happen in the US Dollar (USD) until the FOMC meeting happens, now that calm has returned after the great excitement last week. In addition, the US labor market report for July, one of the big data heavyweights that tends to cause a lot of movement in the dollar, will be published on Friday.”

“In this respect, I will keep it brief and can only advise you to think again about the side in EUR/USD that would hurt you the most. We have emphasized several times since last week that the market may have gone a little too far with its Fed Funds rate expectations. First doubts already seem to be arising.”