Franulovich, analyst at Westpac noted that next week’s FOMC could easily stymie EUR. Key Quotes: "The Fed’s infamous dot plot should reveal fewer hikes, perhaps three in 2016 and 2017 vs four each year as of the last projections, but the statement should be more hawkish. Upside surprises on growth, jobs and inflation will alleviate concerns about downside risks and should see the Fed declare that the risks to jobs and activity are once again “balanced”, a characterisation they eschewed from making in their Jan statement. The statement should also signal that upcoming meetings are “live”, perhaps by using language similar to that of Oct 2015 when the Fed put markets on notice with the comment that, “In determining whether it will be appropriate to raise the target range at its next meeting…”. A hawkish shift in the Fed’s tone – already evident in recent speeches by San Fran's Williams and Vic Chair Fischer – should see the USD benefit from likely further positive data surprises. Thus far the USD has gone mostly unrewarded for a material shift in a wide swathe of data, from core CPI/PCE, retail sales, IP and payrolls – a turnaround flagged by our US data surprise index model back on 8 Feb. The improved tenor of the data has arguably boosted risk appetite moreso, at least so far, indirectly tarnishing the USD. But, our US data surprise index is still some distance from hitting levels that warn a reversal is imminent and if the Fed next week signals that future meetings are “live” we should expect the USD to start benefiting from likely more decent data going forward."" For more information, read our latest forex news.