Central bank decisions have a significant impact influencing the direction of global forex markets.
When a central bank adjusts interest rates, market participants quickly evaluate the expected outcomes for forex market stability.
Leading central banks worldwide set policy tools to control inflation, manage employment, commodities price and stabilize the economy.
Raising the benchmark rate often strengthens a nation’s currency due to higher yields for investors.
Lowering interest rates can cause selling pressure since investors look for better yields elsewhere.
