Euro continues to rise even though Fed officials said they are not going to change their stance on interest rates. Clearly, the bar for a less aggressive policy remains high in spite of the central bank already getting the signals it has long been counting on from the economy.

On the other hand, the Reserve Bank of Australia surprised investors yesterday when it raised rates by less than half of what was forecasted. This fueled a rally in equity markets, as well as in risky assets such as euro and pound.

Although senior Fed officials warned that the fight against inflation will take longer than originally planned and did not give any hint that a similar RBA-like adjustment could happen at the next meeting on November, market participants continue to bet on a less aggressive policy next year. They said the decisions will be influenced by two key indicators: the US Nonfarm Payrolls Report and the Consumer Prices Report due October 13th. These data can change the mood of market participants, which improve every day.

Even so, most Fed members support a hawkish scenario, saying that the restoration of price stability could take some time and likely entail a period of below-trend gains. High inflation could also fuel household inflationary expectations.

To continue the growth of EUR/USD, it is necessary to break through 1.0000, as only by that will the quotes climb to 1.0040 and 1.0085. Meanwhile, a drop below 0.9900 will push the pair to 0.9850, then to 0.9800 and 0.9760.

In GBP/USD, a lot depends on 1.1500 because its breakdown will lead to a rise to 1.1540 and 1.1590. On the other hand, a fall below 1.1420 will push the pair to 1.1360, then to 1.1300 and 1.1230.