Equities are holding firm overnight ahead of the Fed’s policy statement. Traders want to see indications that the Fed sees improvements in the economy. At the same time, they don’t want to see higher interest rates. This sets up the possibility of a choppy two-sided trade following the release of the FOMC statement.

The U.S. Dollar traded higher all day as speculators increased bets that the Fed would issue a more hawkish monetary policy statement tomorrow. Last night the main trend turned up on the weekly chart leading to a firm opening this morning.

The U.S. Dollar is declining overnight as speculators are downplaying the debt problems in Dubai. Over the week-end, the United Arab Emirates central bank said it “stands behind” the country’s lenders. This helped to ease concerns that the state owned Dubai World will default on its debt. Traders now believe that this is a local economic problem rather than one with global ramifications.

The Dollar is trading slightly better as traders await this morning’s U.S. 3rd Quarter GDP Report. The report is expected to show a decrease from the previous estimate. Previously the report showed an increase of 3.5% which some economists thought was too high. Today’s report is expected to show growth of 2.8%.