The OPEC meeting and the US Nonfarm Payrolls rocked the market last week. The market is torn between optimism about the global economic recovery and concerns about the new coronavirus strains.
Greenback ascends, as Draghi pressures euro
On Thursday, the evergreen buck managed to ascend versus its counterparts. A weakening euro enabled market participants to purchase the evergreen buck after ECB Governor Mario Draghi repeated that interest rates would be left intact until 2019.
Estimating the purchasing power of the US currency against a bunch of its major rivals, the USD index managed to add 0.46% trading at 94.41.
On Thursday, Draghi confirmed the major bank’s intention to keep interest rates intact at least until the summer of next year.
He also told that market expectations of rate lifts turned out to be aligned enoug with the ECB’s own projections.
It actually confirmed investors’ hopes that the EU’s key financial institution is reluctant to have interest rates lifted until October 2019, thus making the common currency sink versus the US dollar.
The currency pair EUR/USD went down 0.54% reaching $1.1665.
The reports disclosing poor American economic data were unable to tame the greenback's leap due to the fact that market participants were still optimistic on domestic economic surge ahead of second-quarter GDP data.
On Wednesday, the Commerce Department told that core durable goods orders ascended by 0.4% in June, confounding experts’ forecast for a 0.5%.
Meanwhile, the US Department of Labor informed that initial jobless claims soared by 9,000 hitting 217,000, ruining experts’ forecast for a drop to 215,000.
In June, the goods trade deficit of the United States extended to $68.33 billion in June.
The evergreen buck was also underpinned by a sink in the British pound because Brexit-related angst kept putting pressure.
The currency pair GBP/USD headed south by 0.48% trading at $1.3127. The currency pair is still above the minimums observed the previous week, when it slumped below $1.30.
The currency pair USD/JPY soared 0.16% trading at Y111.16, USD/CAD added 0.09% hitting C$1.3059.
All eyes are turning to the Federal Reserve and the US dollar. How to trade XAU/USD, EUR/USD, and GBP/USD?
The main bank of Russian will likely turn hawkish today. Time to sell USD/RUB?
The overall market sentiment is risk-on. The S&P 500 index (US 500) is getting close to the all-time high. Oil is recovering quickly from its recent losses.
What will happen? The FOMC statement will be published at 21:00 MT (GMT+3) on Wednesday, July 28…
PMI reports from the EU, the UK, and the USA will be released during the day!