The QE policy and its effect on the EUR/USD prices

The QE policy and its effect on the EUR/USD prices

 We have noticed that most of the currency pairs including the dollar as a party , especially the EUR/USD and GBP/USD  witnessed sharp fluctuations and a significant  rise as a result of growing doubts and uncertainty  about the future of the Federal Reserve QE program to stimulate the economy, pushing the dollar  low.

And the main focus of the investors turn  to the results of the US  Federal Bank decisions , during its  meeting on 18th  and 19th of June concerning  the new policy.

So it is important to know what the QE (Quantitative Easing) means??

Quantitative easing (QE) is used by central banks to stimulate the national economy and inject liquidity , A central bank implements quantitative easing by buying financial assets from commercial banks and other private institutions, when conventional monetary policy becomes ineffective , This is distinguished from the more usual policy of buying or selling government bonds in order to keep market interest rates at a specified target value

 

So we recommend the traders who trade the currency pairs in which the US Dollar is part of this pair to monitor the decisions of the QE policy that will have a significant impact on the market and price trend.
Therefore, any positive decisions on new quantities easing policy on 18th   and 19th of  June may push  the dollar higher and thus both EUR / USD and GBP / USD currency pairs down.