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Forex pairs in this Article » EUR/USD, USD/CHF, GBP/USD, USD/JPY (Córdoba) - Market sentiment improved Wednesday after the Turkish central bank aggressively hiked rates and provided some relief to emerging markets concerns. However, the risk-on rally was short lived, with most pairs in the FX market reversing Asian moves during the European trade.

The EUR/USD was capped once again by the 1.3685 zone and turned lower, erasing intraday gains, while the GBP/USD failed to hold above 1.6600 and pulled back to the 1.6550 area. The USD/JPY dipped back below 103.00 after finding resistance at the 103.45 area, while USD/CHF failed to overcome the 0.9000 mark and came under pressure.

The Aussie is underperforming among commodity currencies, having fallen below 0.8800 versus the dollar, while the CAD and the NZD area virtually unchanged.

Ahead of the Fed decision, investors will likely refrain from taking big positions, with consensus pointing for another 10B taper.

Main Headlines in Europe:

Germany: Gfk Consumer Confidence Survey improves to 8.2 in February

Switzerland: UBS Consumption Indicator grows to 1.81 in December

UK: Nationwide Housing Prices climb 0.7% in January

European open: CBRT rate hike supports risk, Fed decision will dominate

EMU: M3 Money Supply up 1.3% in December

Merkel warns EU crisis not over yet
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