The European Central Bank (ECB) has raised interest rates by 25 basis points, marking its tenth consecutive rate hike since July 2022 and bringing the total increase to 450 basis points. The ECB is primarily concerned about high inflation levels, both current and projected, with concerns extending into the future.
2020-04-03 • Updated
Awesome Oscillator: at zero line
What looks like a stopped heartbeat on the GBP/USD H4 is a consolidation of the currency pair with almost 0% fluctuation. Why suddenly?
First, the GBP was losing to the USD due to fueled demand of investors for the USD as a reserve currency. But then, in the second part of March, the reports started growing gloomier for the US. Donald Trump eventually changed the tone at his press conferences from optimistic to quite pessimistic, and +6.5mln applications for the unemployment benefits among the Americans made the US dollar tremble. At the same time, that disappointment did not hit as strong due to hopes on the US-President-suggested scenario for the OPEC+ to cut oil supply by 10mln per day on Thursday.
However, the GBP could not take advantage of none of that because the UK is in a dire situation itself. The Bank of England is pumping more currency into its economy and plans to keep doing so. Hence, both currencies got weaker, although due to a different set of factors.
What will it be next? In the short term, today’s NFP will show. In the long-term, the strength is still on the US dollar’s side.
The upcoming August inflation data may send mixed signals. The 12-month headline inflation rate is expected to rise to 3.6%, causing concerns for the Biden administration. However, core inflation, which excludes food and energy prices, is projected to decrease to 4.3%, aligning with the Federal Reserve's goals. Past price trends influence both figures, so looking at recent data for a more accurate picture is crucial.
The odds of a final interest rate hike by the US Federal Reserve (Fed) this year have dropped after US job openings hit their lowest levels since early 2021. This has led to a correction in the US Dollar as traders reduced their bets on further rate hikes.
The past several weeks have been a real triumph for the bulls in the oil market. The Brent spot price grew by 8.5% during the last month.
Gold prices are rising for three consecutive days ahead of the Federal Reserve (Fed) interest rate decision, which is expected to remain unchanged due to declining inflation and a positive economic outlook. Investors are keen on the Fed's interest rate guidance, fearing a hawkish stance that could trigger market risk aversion.
Amid concerns of a Chinese economic slowdown, reports of declining investment often overlook China's efficient investment strategy in emerging sectors for long-term growth. China has taken measures to stabilize foreign and private sector investments, like reducing the reserve requirement ratio to boost investor confidence.