Today the foreign exchange market digests yesterday's FOMC decision on the basic rate of federal funds and practically ignored the next economic data on the US economy.

Yesterday the Federal Reserve reduced the basic and credit rates by 0,5 %, thus now the federal fund rate is equal to 4,75 % and the credit rate (the rate on which FRS grants loans to commercial banks) is equal to 5,25 % per annum now.

It is necessary to note that so aggressive FRS decision became a little bit unexpected by market players. Till this moment, since the very beginning of government of the Federal Reserve Ben Bernanke proved as the sample of predictability and his style of direction was not considered as strong radicalism.

It became the first drop in federal funds rates since June, 2003, and last drop in the rate at once by 0.5% was observed in November, 2002. We remind that after that since the middle of 2003 and up to the end of 2006, FRS under the head of A.Greenspan lifted rates 18 times in a row.

The US stock market reacted rather actively to this decision, Dow-Jones, the most authoritative industrial index, was closed by growth by 335 points or by 2,5% up to 13 739 points that was the strongest day time gain of this index for last four years. Investors’ moods elated in hope that measures of the Federal Reserve will help to overcome crisis in the market of the real estate, and as a whole will affect positively the US economy.

Despite so slump of the rate and the resolute actions of the Federal Reserve unusual for present FRS government, Wall Street believes that it is not the last downturn of the rate this year.

According to Reuters’ survey made soon after announcement of the decision about drop in the rate, 12 of 18 surveyed dealers chosen by chance, expect reduction of the rate by 0,25 % at October FOMC session, and 6 of them expect the it in December.

However, according to the same survey dealers suppose that the present cycle of monetary policy easing will not be so aggressive the next 2008 year and as soon as the situation in the housing market and in sphere of mortgage lending is normalized FRS will again carry out policy of stabilization.

In FRS statement published on results of session, it is said that "since the last FOMC meeting the situation in the financial markets has strengthened the uncertainty concerning the economic forecast".

"The committee will continue estimation of influence of these and other effects on prospects of economical growth and, in case of need will take measures for maintenance of price stability and long economic rise".

So, FRS decision on Tuesday caused a strong wave of dollar sales against euro, the prices have touched almost a key level of 1,4 dollars for the euro, a new historical level. Today the euro\dollar prices were corrected a little in a new narrow price range, between levels 1,3925 and 1,400, on a background of data on the market of the real estate for August, which were not so bad.

At the same time data on consumer prices for August showed that inflation is in controlled limits that even more strengthened market’s opinion that FRS can reduce rates of federal funds once again by the end of year. Basic index of inflation Core CPI remained constant in August - 0,2 %, and generalized index CPI showed decrease by 0,1 % in August against growth in July by 0,1 %.

Thus, the key level of 1.4 dollars for euro became already objective reality and by the end of this year the objective reality becomes a level of 1,45 dollars for euro.

On the open positions: stop on euro is placed almost by one hundred points upwards, in fixed profit, at a level 1,3910.