This is not a panic situation so the Fed’s decision will still be data dependent. If labor market, manufacturing and inflation data continue to come in weak, then they’ll cut in July. If it stays steady or improves, then they won’t. That’s the risk of being “all in” at current price levels.
The U.S. Dollar plunged against a basket of currencies, helping to drive up demand for the dollar-denominated asset. Meanwhile, 10-year U.S. Treasury yields hit their lowest level in nearly two years as investors increased bets on a Fed rate cut in July. U.S. West Texas Intermediate and international-benchmark Brent crude oil prices are trading higher early Thursday after a lack luster performance the previous session. Natural gas futures plunged on Wednesday to a multi-year low as weather models remained somewhat bearish and relatively cheap prices failed to attract enough major buyers to stop the price slide.
Will the BoE continue to talk of the need to hike rates at an aggressive pace or has the economic data and shift in policy elsewhere caused a reevaluation…
Investing.com - Gold prices jumped on Thursday in Asia after the U.S. Federal Reserve kept the door open for an interest rate cut later this year.
Investing.com - The U.S. dollar fell to three month lows against a currency basket on Thursday in Asia after the Federal Reserve signalled it was prepared to lower interest rates amid mounting concerns over the global growth outlook.
The German PPI reported -0.1% over 0.2% forecast, lowering investor interest. Following some astounding reports, the GBP/USD pair skyrocketed 0.73% touching 1.2636 marks.
The Gold markets fell a bit during trading on Wednesday as participants try to get out of the market ahead of the Federal Reserve. After all, we have rallied quite significantly and you never know what the Federal Reserve will end up doing.
The US dollar has been very choppy against the Japanese yen as you would expect, heading into the Federal Reserve meeting. The question now is whether or not we get enough of a “risk on” situation to warrant higher prices.
The British pound rallied significantly during the trading session on Wednesday as we awaited the Federal Reserve statement, so therefore it looks as if the market is banking on some type of diabetes when it comes to that announcement.
The British pound initially fell during the trading session on Wednesday but turned around to show signs of life again as we have gotten a bit oversold. Ultimately, this is a market that does tend to move with risk appetite so it could be a volatile next couple of days.
The Euro has done very little during trading on Wednesday as we continue to hover around the 1.12 handle. Because of this, the market looks very likely to favor a lot of back and forth until we get that announcement.
The Australian dollar was a bit soft on Wednesday as we continue to consolidate overall. However, this is a market that I believe will continue to show a lot of noise, as the Aussie dollar is highly influenced by what happens with the US/China trade talks.
Based on the early price action, the direction of the August Comex gold futures contract is likely to be determined by trader reaction to the 50% level at $1349.40 and the short-term uptrending Gann angle at $1347.60.
The Dollar index appears to be carving a path back down towards the psychological 97 handles, having been in a holding pattern in the hours leading up to the Federal Reserve’s policy announcement.
Investing.com - Gold rallied in Wednesday’s post-settlement trading after the Federal Reserve kept the door open for an interest-rate cut further down the road.
Based on the current price action, the direction of the EUR/USD on Wednesday is likely to be determined by trader reaction to the uptrending Gann angle at 1.1202. It’s a wide range, but look for an upside bias to develop on a sustained move over the 50% level at 1.1227. Watch for a downside bias to develop on a sustained move under 1.1185.
Elsewhere, the euro was stronger on the weak dollar, with EUR/USD up 0.2% to 1.1210, while sterling surged, with GBP/USD up 0.6% to 1.2626. USD/CAD fell 0.1% to 1.3357.
Tensions around trade wars subsided following news reports that both the US and China leaders are set to hold an ‘extended meeting’ next week at the G20 summit in Osaka, Japan.
European markets did not continue the rally that began in Asian markets as investors looked to central bank meetings in Europe and the U.S. U.S. President Donald Trump gave fresh hope to investors as he announced on Twitter that he would meet Chinese President Xi Jinping at the G-20 summit next week in Osaka, Japan. Trade negotiations had been stalled since mid-May after the U.S. accused China of reneging on aspects of the deal that had already been agreed, with China firing back in state media.