Will the CPI Crash the USD?
The most impactful releases of this week will fill the market with volatility and sharp movements. Be ready to take action!
Greenback mostly dives ahead of Fed minutes
On Thursday, the evergreen buck turned out to be softer across the board due to the fact market participants were waiting for the minutes of the Fed’s last policy gathering in the afternoon and also looked ahead to June jobs report on Friday. Trade war fears affected market sentiment too.
News that America had rolled out zero duties on car imports as well as exports between the EU and the US drove equities as well as other assets, which are considered to be risky. It enabled the greenback to restore ground versus its Japanese counterpart, normally considered to be a safe-have asset. On the contrary, the news had the euro lifted.
The evergreen buck held on to a small advance against Japan’s currency, although stood weaker against most major counterparts after Automatic Data Processing Inc. informed that in June employers managed to generate up to 177,000 private-sector jobs. Additionally, the Labor Department told that first-time jobless claims reached a six-week maximum, although layoffs are still near a multi-decade minimum.
Moreover, market participants have started paying more attention to wage reports. It’s because they look for signs of acceleration of pay lifts, which could potentially feed inflation and also convince the Federal Reserve to have rates increased more aggressively than expected.
While the deal hasn’t been uncovered yet, both sides are eager to avoid a full-scale trade conflict, which could affect the global economic revival.
In general, trading is supposed to remain muted due to the fact some American investors extend the midweek Fourth of July break. On Wednesday, American markets were unavailable due to Independence Day.
The USD index slumped 0.5% hitting 94.229.
As for the common currency, the currency pair EUR/USD was seen at $1.1712 in contrast with the previous outcome of $1.1657.
Similar
Three Currencies to Watch This Week
We prepared an outlook of major events of this week. Check it and be ready!
The Fed won't miss these releases!
Here you'll find what awaits the market this week, from the CPI release to a possible gold plunge.
Latest news
Nonfarm Payrolls is in Focus Today
The situation on the labor market still looks optimistic. Today we expect the Unemployment rate data. 3.5% is expected.
No More US Debts in Sight
The first day of June should’ve brought us the US default. Unsurprisingly, the US House passes the debt ceiling bill at the latest possible moment.
Gold Rises as Central Banks Buy More
About 24% of global central banks intend to increase gold reserves in 2023. Rising inflation, geopolitical turmoil, and worries about interest rates are reasons to increase gold reserves.
