USD pairs rangebound ahead of Fed & BoC decisions today

Major USD pairs are trading in tight ranges during the European session, with traders exercising caution ahead of today's pivotal central bank decisions. The Federal Reserve's FOMC meeting at 19:00 GMT is expected to deliver a 25 basis point rate cut, bringing the fed funds rate to 4.25-4.50%. Markets are pricing in a 95% probability of this cut, with focus shifting to Chair Powell's forward guidance and the updated dot plot projections. Earlier at 14:45 GMT, the Bank of Canada will announce its rate decision, with consensus expecting a 50bp cut to 3.25% amid slowing economic growth. USD/CAD hovers near 1.4250, while EUR/USD consolidates around 1.0530. The absence of European economic data has contributed to the subdued price action. Traders should expect increased volatility post-announcements, with potential breakouts from current ranges depending on the tone of central bank communications.