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 soars ahead of Fed decision
On Wednesday, the major US currency tacked on versus a group of its key counterpart ahead of the decision of the Fed’s latest policy gathering. Meanwhile, the risk sensitive Australian currency was suppressed by resumed trade worries.
Estimating the greenback’s purchasing potential versus its main rivals, the USD index managed to add 0.10% hitting 94.42.
The key US bank isn’t anticipated to uncover any change in its rates after its gathering on Wednesday. Investors are more prone to thinking that the next rate lift will take place in September.
Tuesday’s data disclosed that American consumer spending reported solid revenue in June. At the same time, US inflation edged up a bit, thus backing the view that the American economy is recovering.
The common currency was nearly intact for the day. The currency pair EUR/USD reached 1.1688.
As for the evergreen buck, it gained versus Japan’s currency. The currency pair USD/JPY soared by 0.22% coming up with 112.12.
The Japanese yen was still on the back foot after the Asian country’s major financial institution promised to keep interest rates low enough for the time being after its latest policy gathering on Tuesday. Additionally, the bank also made minor tweaks to its asset purchase program with the aim of making it more flexible. On the contrary, many investors had expected more radical moves from the BOJ.
Meanwhile, the UK currency headed south. The currency pair GBP/USD dipped by about 0.08% reaching 1.3112 ahead of July manufacturing report out of Great Britain expected to demonstrate a minor sag at the beginning of the third quarter.
The Australian dollar inched down. The currency pair AUD/USD slumped by 0.32% being worth 0.7404 in the face of worries over an escalation in trade tensions.
The New Zealand dollar dived too. The currency pair NZD/USD declined by 0.34% hitting 0.6796.
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!