Last week, there were sharp swings in USDJPY, a decline in oil prices, and a surge in Tesla stock. What's next?
Evergreen buck moves down
On Thursday, the evergreen buck declined versus its counterparts because a deceleration in inflation triggered a series of warnings from market experts that the US currency was approaching another maximum.
Estimating the greenback’s purchasing potential against a number of its primary rivals the USD index declined by 0.27% being worth 94.56.
On Thursday, the Labor Department told that its Consumer Price Index soared by 0.2% in August, which is below analysts’ estimates for a 0.3% jump. The slower tempo of soaring consumer prices in August, brought the year-on-year increase in the CPI down from July’s 2.9% to 2.7%.
The report won’t probably affect the key US bank’s policy stance. However, it gives evidence that the US currency is close to its maximum because valuations are definitely getting stretched, with lopsided positioning.
The evergreen buck also dived versus both the UK currency and euro after updates from the Bank of England as well as European Central Bank.
The currency pair GBP/USD tacked on by 0.50% being worth $1.3107 because Britain’s key bank left rates on hold, although expressed optimism over the country’s economy, referring to both stronger-than-anticipated second-quarter economic as well as wage surge.
The currency pair EUR/USD jumped by 0.45% being worth $1.1678 after the European Central Bank's widely anticipated unchanged rate verdict and also signs the key financial institution is fully committed to ceasing its bond-buying program.
The evergreen buck also showed up on the wrong side of a soar in emerging market currencies right after the Turkish currency jumped in the wake of the Turkish major bank’s decision to have rates lifted to 24%.
The currency pair USD/CAD went down by 0.04% trading at C$1.2991, rebounding from session maximums, suppressed by investor optimism for a successful result from Canada and United States negotiations on a revamp of the NAFTA.
The currency pair USD/JPY jumped by 0.51% trading at Y111.83.
Geopolitical factors and inflation remain the main drivers of financial markets. Let’s see how to use that in trading!
Have a look at the key financial instruments on Monday, February 28. Geopolitics is currently on all news frontlines. Western nations escalated sanctions on Russia for the invasion of Ukraine.
The US Bureau of Economic Analysis will publish Core Personal Consumption Expenditures (PCE) on May 27 at 15:30 GMT+3.
The United States will publish the Preliminary GDP on Thursday, May 26, at 15:30 GMT+3.
The Reserve Bank of New Zealand will publish a monetary policy report and make an update on the interest rate on May 25, at 05:00 GMT+3.