By FXEmpire.com

As investors eagerly await the US FOMC rate announcement and press conference later tonight, expectations are high that the US central bank may provide additional stimulus measures to support the stalling economy. Shares rose and commodities steadied ahead of the highly awaited event.

Meanwhile, the euro gained against the US dollar on hopes that the Fed may resort to monetary easing in the midst of faltering economic growth and worsening debt crisis in Euro Zone. The euro has climbed against the USD, trading at 1.2718. Spot gold traded mostly steady in thin ranges today after posting its first decline in more than a week during the previous session. In the mean time, spot gold continued to consolidate, looking out for fresh cues for further directional moves. Base metals were steady to. Copper inched lower ahead of the US FOMC rate decision as investors remained wary of Spain’s worsening financial condition.

Crude oil dipped in Nymex after rising the previous session while Brent crude oil slipped towards 17 month low levels. Intensifying worries over Spain and flattering global economic outlook weighed on the overall market sentiments. However, fall in crude oil inventories and monetary stimulus hope arrested fall.

API data released earlier today reported a decline in crude oil inventories. EIA data is also anticipated to show a draw in crude oil inventories.

Market emotions remained subdued ahead of the much anticipated U.S FOMC rate decision, later today.

After two weeks of disappointing economic numbers and an escalating debt crisis in Europe threatening recovery for the U.S economy, the Federal Reserve FOMC meeting would be keenly looked at in anticipation that the Federal Reserve announces a new round of extraordinary monetary stimulus, such as big purchases of bonds to revive stalling U.S economic situation. With the Presidential elections just a few months off, the Obama Administration needs to show positive economic recovery unless he and his government will be pushed out of office.

The Department of Energy crude inventories slated for release today is estimated to show a fall in levels.

With the crisis in the eurozone taking leaps and turns, European finance ministers will be meeting in Luxemburg on tomorrow to discuss the European crisis and evaluate the Greek election outcome. Also, topping the agenda would be enhancing the firepower of the EFSF.

Overall, volatility is likely to the byword this week with markets expected to vacillate over events surfacing in Europe and the U.S.

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Originally posted here