ING Research discusses EUR/USD and GBP/USD outlook ahead of tomorrow's FOMC and Thursday's BoE.
"EUR/USD will continue to trade a range into tomorrow's Fed meeting. Recall that positioning can prompt some strange outcomes, where the hawkish set of Fed Dot Plots in September actually saw EUR/USD rally in the aftermath to 1.1750, before subsequently dropping 5%," ING notes.
"European natural gas prices continue to push ahead. When these were last this high back in September and early October these had tended to drag GBP money market rates around on the view that higher energy prices would make it more likely that the BoE would respond with a hike. This was pre-Omicron of course, but let's see whether GBP interest rates and perhaps spot FX also start to derive some support here," ING adds.