Today begins the Federal Reserve’s 2-day policy meeting. Ahead of US monetary authorities’ decisions the markets are concerned that US economic growth acceleration won’t be enough for monetary tightening. The greenback weakened today versus the majority of its counterparts. The pair EUR/USD is trading close to 2-month high at 1.3687.

Analysts at Bank of New Zealand note that the Fed is still worried about high unemployment (9.4% in December while the FOMC long-term target is set at 5-6%), very subdued core inflation and generally fragile outlook that, in their view, will put some pressure on the greenback and US bond yields.

It’s also expected that home prices dropped by the most since December 2009: economists surveyed by Bloomberg project that S&P/Case-Shiller index lost 1.6% in November from a year earlier. The data will be releases at 1400 GMT.

Currency strategists at UBS AG note that to support dollar’s rate in such situation US fourth quarter GDP has to be in on or above expectations. The median forecast shows the 3.5% annual growth from 2.6% rate in the previous 3 months. US GDP is due on January 28.

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