As expected, the Federal Reserve maintained the targeted interest rate range unchanged at 0.5 to 0.75 per cent in the FOMC meeting last night, without giving much clues of the timing of the next rate hike.

Nonetheless, the moderate pace of rate hikes is still bared in investors’ minds as inflation is on track to hit the Fed’s target.

Two to three rate hikes this year is widely expected by market participants, with Bloomberg’s world interest rate probability forecasting a near to 70% chance rate hike in June. The US dollar remains soft after the FOMC meeting.

Tonight BoE will announce its interest rate decision, which is widely expected to be unchanged. Against the backdrop of a softer US dollar, sterling advanced almost 5.7% against the greenback since 16 January this year. Technical indicators including 10 Day Moving Average, Super Trend and MACD remained bullish on the GBP/USD, suggesting that this uptrend would probably continue.

The Nasdaq Index rose 0.5% last night, fuelled by Facebook’s positive earnings surprise. The S&P 500 and Dow Jones, however, closed flat as investors await for more evidence to justify the “Trump rally” while balancing the positive and negative impact that the new policies could bring to the market.

Facebook’s revenue and earnings soared in the fourth quarter. Its Earning per share (EPS) of $1.41 was 7% higher than consensus of $1.31. The company’s revenue soared 51% to $8.8bn, higher than forecast of $8.5 bn as advertisement revenue rose sharply during the holiday season.  

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