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Forex pairs in this Article » EUR/USD (New York) - The euro faltered on the back of this before giving up all of its gains when it was announced yesterday evening that the Italian sovereign rating was downgraded to BBB with a negative outlook by the ratings agency S&P, noted Lee McDarby, Corporate Treasury at Investec.

It is the turn of US central banker Bernanke to speak today and this is becoming the marquee event in markets as the fate of QE tapering across the pond is very much in his hands. According to McDarby, “Any suggestion from Bernanke that tapering could come as early as September will likely cause a further rally in the US dollar but if he happens to temper expectations and deliver a more dovish tone then you could see a significant correction in the recent USD strength.” With this in mind the FOMC minutes released from the US this evening will be very closely watched as investors try and crack the Fed’s code and second guess when QE tapering will begin
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