Forex News Timeline

Thursday, June 13, 2024

The Mexican Peso (MXN) seesaws between tepid gains and losses on Thursday after bottoming out at an 18-month low due to politically-inspired market jitters.

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Critics say the reforms would compromise the independence of the judiciary, frightening off foreign investors; supporters argue it will eradicate endemic corruption and attract more investment.  At the time of writing, a single US Dollar (USD) buys 18.77 Mexican Pesos (compared to circa 17.00 just prior to the election). EUR/MXN, meanwhile, is trading at 20.29 and GBP/MXN at 24.03. Mexican Peso to stay strong because of the economy, says Obrador The Mexican Peso bottomed out at a one-and-a-half-year low on Wednesday as President Andres Manuel Lopez Obrador (AMLO) hit back at critics of his policies during a press conference.  “They don’t like it (the reforms) and so they are applying pressure to gauge whether there is fear in the markets,” said AMLO during his daily broadcast. “Our economy is very strong, thankfully. So how long are they going to keep stoking concerns – in the television, in the radio, in the newspaper columns of financial experts? And they know how to move the markets. But today the Peso has recovered 1% against the US Dollar because we have a strong economy and healthy public finances,” he added. Obrador argued that Mexico’s strong economy was due precisely because of the government’s war on corruption. He went on to say that the Peso’s fall was due to speculators not investors, and that real investors would welcome his reforms because they wanted a “real” government whilst speculators wanted a “bowlegged” government – “It is the latter who don’t want reforms to clean a corrupt judiciary,” he added.

When asked at what point the depreciation of the Peso would begin to concern him, AMLO said there was no problem with the Peso. Rather, the corrupt elites were stirring market sentiment in an attempt to blackmail the government into ditching its reforms so they could hang onto their power and privileges, he added.  Obrador then pointed at a graphic behind him showing the changes in the value of the Peso under the last six Presidents. His administration was the only one under which the Mexican Peso had risen and not fallen in value.  When asked how soon it would be before the reforms to the judiciary would be passed, AMLO said, given their importance, “September”. Mexico’s congress is expected to convene on September 1, which would give López Obrador a one-month window to push through reforms before retiring.  To the argument that there would not be a clear separation of powers in the case where judges were elected, AMLO countered, “On the contrary, there would be more separation, since the appointment of judges would not depend on a minority but the population at large.” The Peso, in particular, bounced against the US Dollar (USD) as it was aided by USD weakness. The release of cooler-than-expected US inflation data on Wednesday in the form of the Consumer Price Index (CPI), increased the chances the US Federal Reserve (Fed) will cut interest rates in September. Lower interest rates are negative for the Dollar as they attract less foreign capital inflows.  Technical Analysis: USD/MXN almost peaks at 19.00 and rolls over USD/MXN pulls back in the last 24 hours after peaking at 18.99. Despite falling to the 18.70s, it continues trading with a bullish bias on Thursday.  USD/MXN is in a short and intermediate term uptrend after decisively breaking above key resistance at 18.49 (October 2023 high).  USD/MXN Daily Chart 
  Given “the trend is your friend,” the odds favor a continuation higher in the short term, with the next target potentially situated at 19.22 (March 2023 high). The Relative Strength Index (RSI) is in the overbought zone, however, suggesting traders should not add to their long positions. It also increases the possibility of a pullback developing, although the established uptrend is likely to eventually resume. The direction of the long-term trend is in doubt after the break above the October 2023 high. Previous to that, it was down.  Economic Indicator Consumer Price Index (YoY) Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish. Read more. Last release: Wed Jun 12, 2024 12:30 Frequency: MonthlyActual: 3.3%Consensus: 3.4%Previous: 3.4%Source: US Bureau of Labor Statistics Why it matters to traders? The US Federal Reserve has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.  

USD/CAD breaks its three-day losing streak, trading around 1.3730 during the European session on Thursday.

USD/CAD could test the lower boundary of the rising channel, potentially rebounding to re-enter the rising channel.A break below the 50 level on the 14-day RSI could indicate the emergence of a bearish bias.The pair may find immediate support at the psychological level of 1.3700 and the 21-day EMA of 1.3697 level.USD/CAD breaks its three-day losing streak, trading around 1.3730 during the European session on Thursday. Analysis of the daily chart suggests a weakening bullish bias for the USD/CAD pair, as it has broken below the rising channel pattern. However, the 14-day Relative Strength Index (RSI) is still positioned slightly above the 50 level. Further movement may give a clear directional indication. Additionally, the momentum indicator Moving Average Convergence Divergence (MACD) suggests a bullish trend for the pair as the MACD line is positioned above the centerline, it shows divergence above the signal line. The USD/CAD pair may test the lower boundary of the rising channel around the level of 1.3760, followed by the key barrier at the psychological level of 1.3800. A return to the rising channel could reinforce the bullish bias and support the pair to explore the region April’s high of 1.3846. A break above the latter could lead the USD/CAD pair to approach the upper threshold of the rising channel around the level of 1.3870. On the downside, the USD/CAD pair could find immediate support at the psychological level of 1.3700, aligned with the 21-day Exponential Moving Average (EMA) of 1.3697 level. A break below this level could exert pressure on the pair to navigate the region of the throwback support at 1.3590. USD/CAD: Daily ChartUSD/CAD Overview Today last price 1.3732 Today Daily Change 0.0008 Today Daily Change % 0.06 Today daily open 1.3724   Trends Daily SMA20 1.3679 Daily SMA50 1.3685 Daily SMA100 1.3598 Daily SMA200 1.358   Levels Previous Daily High 1.3761 Previous Daily Low 1.368 Previous Weekly High 1.3768 Previous Weekly Low 1.3603 Previous Monthly High 1.3783 Previous Monthly Low 1.359 Daily Fibonacci 38.2% 1.3711 Daily Fibonacci 61.8% 1.373 Daily Pivot Point S1 1.3682 Daily Pivot Point S2 1.3641 Daily Pivot Point S3 1.3601 Daily Pivot Point R1 1.3763 Daily Pivot Point R2 1.3802 Daily Pivot Point R3 1.3844    

Silver prices (XAG/USD) fell on Thursday, according to FXStreet data.

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Silver trades at $29.33 per troy ounce, down 1.34% from the $29.73 it cost on Wednesday. Silver prices have increased by 15.16% since the beginning of the year. Unit measure Today Price Silver price per troy ounce $29.33 Silver price per gram $0.94   The Gold/Silver ratio, which shows the number of troy ounces of Silver needed to equal the value of one troy ounce of Gold, stood at 78.97 on Thursday, up from 78.21 on Wednesday.   Investors might use this ratio to determine the relative valuation of Gold and Silver. Some may consider a high ratio as an indicator that Silver is undervalued – or Gold is overvalued – and might buy Silver or sell Gold accordingly. Conversely, a low ratio might suggest that Gold is undervalued relative to Silver. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.(An automation tool was used in creating this post.)

Eurozone Industrial Production w.d.a. (YoY) below expectations (-1.9%) in April: Actual (-3%)

Eurozone Industrial Production s.a. (MoM) below forecasts (0.2%) in April: Actual (-0.1%)

Gold prices fell in India on Thursday, according to data compiled by FXStreet.

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The price for Gold stood at 6,219.88 Indian Rupees (INR) per gram, down compared with the INR 6,244.83 it cost on Wednesday. The price for Gold decreased to INR 72,544.30 per tola from INR 72,838.46 per tola a day earlier. Unit measure Gold Price in INR 1 Gram 6,219.88 10 Grams 62,196.09 Tola 72,544.30 Troy Ounce 193,457.40   FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly. Global Market Movers: Comex Gold price turns vulnerable as reduced Fed rate cut bets boost USD The initial market reaction to the softer US consumer inflation data on Wednesday faded rather quickly after the Federal Reserve said that it sees only one rate cut this year, which, in turn, is seen undermining the non-yielding Gold price.  The US Bureau of Labor Statistics (BLS) reported that inflation, as measured by the change in the Consumer Price Index (CPI), was unchanged in May for the first time since last June, and the yearly rate edged down to 3.3% from 3.4%. The annual core CPI, which excludes volatile food and energy prices, was up 0.2% during the reported month and rose 3.4% on a yearly basis as compared to the 3.6% increase in April and consensus estimates for a reading of 3.5%. The Fed kept interest rates unchanged at the end of a two-day policy meeting and projected the benchmark rate falling to 5.1% this year, suggesting just one rate cut in 2024 as against a prior estimate of three cuts at the March meeting. Adding to this, the Fed lifted its forecast on the neutral rate to 2.8% from 2.6% previously, providing a modest lift to the US Dollar and contributing to driving flows away from the USD-denominated commodity.  French President Emmanuel Macron's decision to call snap elections later this month increased political uncertainty in the Eurozone's second-biggest economy and could lend support to the safe-haven precious metal.  Thursday's US macro data could produce short-term trading opportunities later during the early North American session ahead of the Bank of Japan (BoJ) policy decision on Friday, which could infuse volatility in the market.   Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up. (An automation tool was used in creating this post.)

West Texas Intermediate (WTI) Oil price remains steady with thin trading, possibly due to anticipation of upcoming producer price figures from the United States (US).

WTI Oil price remains steady ahead of the release of US producer price figures on Thursday.Oil prices may weaken as higher interest rates dampen the economic growth in the United States.Crude Oil prices faced a challenge as US crude inventories increased by 3.7 million barrels against the 1.55 million-barrel decline.West Texas Intermediate (WTI) Oil price remains steady with thin trading, possibly due to anticipation of upcoming producer price figures from the United States (US). WTI Oil price hovers around $78.00 per barrel during the European session on Thursday. Oil traders have absorbed the hawkish stance maintained by the US Federal Reserve (Fed). The Federal Open Market Committee (FOMC) kept its benchmark lending rate within the range of 5.25%–5.50% for the seventh consecutive time during its June meeting on Wednesday, as widely anticipated. Higher interest rates could hinder economic growth, which in turn negatively impacts Oil demand.Fed Chair Jerome Powell said in a press conference following the Fed's decision that the restrictive stance on monetary policy is having the expected effect on inflation. "So far this year, we have not gained greater confidence on inflation to warrant a rate cut," Powell added. On the supply side, higher US crude Oil stockpiles put pressure on the price of the liquid Gold. Official data released by the Energy Information Administration (EIA) on Wednesday showed that US crude inventories increased by 3.7 million barrels in the week ending June 7. This contrasts with market expectations of a 1.55 million barrel decline, following the previous week's increase of 1.233 million barrels. Additionally, the EIA, in its monthly report, reduced its forecast for Oil demand growth in 2024 by 100,000 barrels per day (bpd), bringing the new estimate to 960,000 bpd. In the Middle East, attention is focused on ceasefire talks in Gaza. Any success could alleviate concerns about potential supply disruptions from the Oil-producing region. In the latest incident affecting maritime security, Iran-allied Houthi militants claimed responsibility for small watercraft and missile attacks on Wednesday. These attacks left a Greek-owned coal carrier in need of rescue near Yemen's Red Sea port of Hodeidah, according to Reuters. WTI US OIL Overview Today last price 78.04 Today Daily Change 0.06 Today Daily Change % 0.08 Today daily open 77.98   Trends Daily SMA20 77.25 Daily SMA50 80.04 Daily SMA100 79.23 Daily SMA200 79.27   Levels Previous Daily High 78.98 Previous Daily Low 77.59 Previous Weekly High 77.36 Previous Weekly Low 72.46 Previous Monthly High 81.25 Previous Monthly Low 76.04 Daily Fibonacci 38.2% 78.45 Daily Fibonacci 61.8% 78.12 Daily Pivot Point S1 77.39 Daily Pivot Point S2 76.8 Daily Pivot Point S3 76 Daily Pivot Point R1 78.77 Daily Pivot Point R2 79.57 Daily Pivot Point R3 80.16    

NZD/USD halts its three-day winning streak, trading around 0.6170 during the early European session on Thursday.

NZD/USD loses ground as US Dollar rises due to the Fed’s hawkish hold on Wednesday.The rebound in the US Treasury yields support the US Dollar.Electronic Card Retail Sales dropped by 1.1% MoM in May as compared to April's 0.4% decrease.NZD/USD halts its three-day winning streak, trading around 0.6170 during the early European session on Thursday. The decline of the NZD/USD pair could be attributed to the advancement of the US Dollar (USD) after the hawkish hold from the US Federal Reserve (Fed) on Wednesday. Investors await the US weekly Initial Jobless Claims and Producer Prices Index (PPI) on Thursday to gain further impetus on economic conditions in the United States (US). The Federal Open Market Committee (FOMC) left its benchmark lending rate in a range of 5.25%–5.50% for the seventh time in a row at its June meeting on Wednesday, as widely expected. Fed Chair Jerome Powell said in a press conference following the Fed's decision that the restrictive stance on monetary policy is having the expected effect on inflation. "So far this year, we have not gained greater confidence on inflation to warrant a rate cut," Powell added. The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, edges higher to near 104.80, possibly supported by the rebound in the US Treasury yields. 2-year and 10-year yields on US Treasury bonds stand at 4.76% and 4.32%, respectively, at the time of writing. In New Zealand, Electronic Card Retail Sales dropped by 1.1% month-over-month in May, a steeper decline against April's 0.4% decrease. However, on an annual basis, the decline was 1.6%, significantly less than the previous year's 3.8% drop. The Reserve Bank of New Zealand (RBNZ) indicated that it has no plans to reduce rates in 2024, with any rate cuts unlikely until mid-2025. Despite facing economic challenges, policymakers have warned that there are still upward risks to inflation. According to a Reuters report, the bond futures market is pricing in about a 44% chance that the RBNZ could ease policy as early as October this year. NZD/USD Overview Today last price 0.6172 Today Daily Change -0.0014 Today Daily Change % -0.23 Today daily open 0.6186   Trends Daily SMA20 0.6139 Daily SMA50 0.6041 Daily SMA100 0.6068 Daily SMA200 0.6058   Levels Previous Daily High 0.6222 Previous Daily Low 0.6122 Previous Weekly High 0.6216 Previous Weekly Low 0.6101 Previous Monthly High 0.6171 Previous Monthly Low 0.5875 Daily Fibonacci 38.2% 0.6184 Daily Fibonacci 61.8% 0.616 Daily Pivot Point S1 0.6131 Daily Pivot Point S2 0.6077 Daily Pivot Point S3 0.6032 Daily Pivot Point R1 0.6231 Daily Pivot Point R2 0.6277 Daily Pivot Point R3 0.6331    

The European Central Bank (ECB) policymaker Bostjan Vasle said on Thursday, it is “possible for more rate cuts if baseline scenario holds.” Additional quotes Also more rate cuts next year if disinflation process continues.

The European Central Bank (ECB) policymaker Bostjan Vasle said on Thursday, it is “possible for more rate cuts if baseline scenario holds.”Additional quotes Also more rate cuts next year if disinflation process continues. But there is a risk that the process could slow down. Wage momentum is still relatively strong. Market reaction As of writing, EUR/USD continues to hold steady near the 1.0800 mark, taking account of Wednesday’s US inflation data and the Fed policy decision.

Spain Consumer Price Index (MoM) meets forecasts (0.3%) in May

Spain Consumer Price Index (YoY) meets forecasts (3.6%) in May

Spain Harmonized Index of Consumer Prices (YoY) meets forecasts (3.8%) in May

Spain Harmonized Index of Consumer Prices (MoM) meets expectations (0.2%) in May

The EUR/GBP cross extends the recovery to 0.8455 during the early European session on Thursday.

EUR/GBP trades with a bullish bias around 0.8455 in Thursday’s early European session. The weaker UK economic reports create a tailwind for the cross. The lower bets on another interest rate cut from the ECB in July cap the pair’s downside. The EUR/GBP cross extends the recovery to 0.8455 during the early European session on Thursday. The cross bounced off the lowest level since August 2022 near 0.8418 as the stagnant UK monthly Gross Domestic Product (GDP) number and weaker Industrial Production data for April dragged the Pound Sterling (GBP) lower against the Euro (EUR). 

On Wednesday, published by the Office for National Statistics (ONS) showed that the UK economy stagnated in April after growing 0.4% in March. The figure was in line with the market expectations. Meanwhile, UK Industrial Production dropped  0.9% MoM in April from a 0.2% increase in March, worse than the estimation of -0.1%.  

On the Euro front, the hawkish cut from the European Central Bank (ECB) seems to underpin the shared currency as ECB  President Christine Lagarde cooled down expectations for another interest rate cut in July and preferred to wait for upcoming data. Later on Thursday, the Eurozone Industrial Production for April will be published, which is expected to rise 0.2% on a monthly basis from 0.6% in March. The weaker sign of the manufacturing sector in the Eurozone might weigh on the EUR and cap the upside for the EUR/GBP cross.  EUR/GBP Overview Today last price 0.8454 Today Daily Change 0.0008 Today Daily Change % 0.09 Today daily open 0.8446   Trends Daily SMA20 0.8508 Daily SMA50 0.8548 Daily SMA100 0.8548 Daily SMA200 0.8599   Levels Previous Daily High 0.8452 Previous Daily Low 0.8418 Previous Weekly High 0.8536 Previous Weekly Low 0.8489 Previous Monthly High 0.8621 Previous Monthly Low 0.8484 Daily Fibonacci 38.2% 0.8439 Daily Fibonacci 61.8% 0.8431 Daily Pivot Point S1 0.8425 Daily Pivot Point S2 0.8405 Daily Pivot Point S3 0.8392 Daily Pivot Point R1 0.8459 Daily Pivot Point R2 0.8472 Daily Pivot Point R3 0.8493    

Here is what you need to know on Thursday, June 13: The US Dollar (USD) seems to have stabilized early Thursday after suffering large losses against its major rivals on soft inflation data on Wednesday.

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In the second half of the day, the US economic docket will feature weekly Initial Jobless Claims data and Producer Price Index figures for May.  US Dollar PRICE This week The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the weakest against the New Zealand Dollar.   USD EUR GBP JPY CAD AUD NZD CHF USD   -0.02% -0.47% 0.25% -0.11% -0.94% -1.00% -0.22% EUR 0.02%   -0.10% 0.54% 0.17% -0.65% -0.72% 0.04% GBP 0.47% 0.10%   0.76% 0.28% -0.55% -0.62% 0.14% JPY -0.25% -0.54% -0.76%   -0.35% -1.27% -1.35% -0.44% CAD 0.11% -0.17% -0.28% 0.35%   -0.80% -0.89% -0.12% AUD 0.94% 0.65% 0.55% 1.27% 0.80%   -0.07% 0.69% NZD 1.00% 0.72% 0.62% 1.35% 0.89% 0.07%   0.77% CHF 0.22% -0.04% -0.14% 0.44% 0.12% -0.69% -0.77%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote). The Bureau of Labor Statistics reported on Wednesday that inflation in the US, as measured by the change in the Consumer Price Index (CPI), declined to 3.3% on a yearly basis in May from 3.4% in April. The annual core CPI, which excludes volatile food and energy prices, rose 3.4%, compared to analysts' estimate of 3.5%. On a monthly basis, the CPI was unchanged, while the core CPI was up 0.2%. The USD Index turned south and slumped below 104.50 with the immediate reaction. Later in the day, the Federal Reserve (Fed) announced that it left the policy settings unchanged following the June meeting, as widely anticipated. The revised Summary of Economic Projections, the so called dot-plot published alongside the policy statement, showed that 4 of 19 officials saw no rate cuts in 2024, 7 projected a 25 basis points (bps) rate reduction, while 8 marked down a 50 bps cut in the policy rate. In the post-meeting press conference, Fed Chairman Jerome Powell acknowledged the encouraging inflation data for May but said that they need to see more "good data" to bolster their confidence on inflation sustainably moving toward the 2% target. Powell further reiterated the data-dependent approach to policy and helped the USD find a foothold. Following the Fed meeting, the S&P 500 Index gained 0.85%, the Nasdaq Composite rose 1.3%, while the Dow Jones Industrial Average lost 0.1%.  Related newsUS CPI lower than expected, while FOMC signals only one rate cut in 2024Markets move post-US CPI and FOMC, China EV Co's brush-off EU tariffsJerome Powell comments on rate outlook after keeping policy settings unchangedEUR/USD climbed above 1.0850 on Wednesday but erased a portion of its daily gains later in the American session. The pair holds steady at around 1.0800 in the European morning on Thursday.GBP/USD touched its highest level since early March above 1.2850 on Wednesday but struggled to preserve its bullish momentum. At the time of press, the pair was trading modestly lower on the day at around 1.2780.USD/JPY registered small losses on Wednesday and climbed back above 157.00 in the European morning on Thursday. The Bank of Japan will announce monetary policy decisions during the Asian trading hours on Friday. The data from Australia showed that the Unemployment Rate edged lower to 4% in May from 4.1% in April as expected. The Employment Change arrived at +39.7K, surpassing the market expectation of +30K. After rising nearly 1% on Wednesday, AUD/USD struggled to extend its rally despite the upbeat data and retreated to the 0.6650 area on Thursday.Gold posted modest gains for the third straight trading day on Wednesday. With the benchmark 10-year US Treasury bond yield stabilizing above 4.3% following Wednesday's sharp decline, however, XAU/USD finds it difficult to attract bulls. At the time of press, the pair was down 0.5% on the day at $2,312. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.    

Switzerland Producer and Import Prices (YoY) remains at -1.8% in May

Switzerland Producer and Import Prices (MoM) below forecasts (0.5%) in May: Actual (-0.3%)

Silver price (XAG/USD) struggles to gain ground above the crucial support of $29.00 in Thursday’s early European session.

Silver price appears to be failing to maintain trade above $29.00 as the Fed sees only one rate cut this year.US bond yields rise despite traders holding Fed rate-cut bets for September.Investors await the US PPI data for further action.Silver price (XAG/USD) struggles to gain ground above the crucial support of $29.00 in Thursday’s early European session. The white metal weakens as the Federal Reserve’s (Fed) dot plot of the June meeting has indicated that policymakers see only one rate cut this year. A few policymakers also advocated for maintaining the current interest rate framework for the entire year as they are less confident about inflation declining to the desired rate of 2%. The appeal for precious metals remains vulnerable even though Fed Chair Jerome Powell acknowledged that there is a slower progress in the disinflation process and the Consumer Price Index (CPI) data for May was cooler than expected. Meanwhile, the US Dollar Index (DXY) has extended its recovery to 104.80 and 10-year US Treasury yields bounce back to 4.33% albeit the CME FedWatch tool shows that traders hold their bets for the Fed to reduce interest rates in the September meeting. Higher yields on interest-bearing assets increase the opportunity cost of holding an investment in non-yielding assets such as Silver. Going forward, investors will focus on the US Producer Price Index (PPI) data for May, which will be published at 12:30 GMT. Annual headline PPI is estimated to have accelerated to 2.5% from 2.2% in April, with core reading growing steadily by 2.4%. Silver technical analysis Silver price will likely deliver a breakdown of the neckline of the Head and Shoulder (H&S) chart pattern, which is marked from May 24 low at $30.00 on a four-hour timeframe. A breakdown of the above-mentioned chart pattern results in a bearish reversal. The near-term outlook remains uncertain as 20 and 50-day Exponential Moving Averages (EMAs) near $29.50 and $29.90, respectively, are declining. The 14-period Relative Strength Index (RSI) hovers near 40.00. A bearish momentum would trigger if it breaks below the same. Silver four-hour chartXAG/USD Overview Today last price 29.18 Today Daily Change -0.55 Today Daily Change % -1.85 Today daily open 29.73   Trends Daily SMA20 30.65 Daily SMA50 28.89 Daily SMA100 26.28 Daily SMA200 24.72   Levels Previous Daily High 30.26 Previous Daily Low 29.18 Previous Weekly High 31.55 Previous Weekly Low 29.12 Previous Monthly High 32.51 Previous Monthly Low 26.02 Daily Fibonacci 38.2% 29.85 Daily Fibonacci 61.8% 29.59 Daily Pivot Point S1 29.19 Daily Pivot Point S2 28.65 Daily Pivot Point S3 28.12 Daily Pivot Point R1 30.26 Daily Pivot Point R2 30.8 Daily Pivot Point R3 31.33    

FX option expiries for June 13 NY cut at 10:00 Eastern Time, via DTCC, can be found below - EUR/USD: EUR amounts 1.0685 899m 1.0750 1.3b 1.0775 1.8b 1.0780 2b 1.0800 1.2b 1.0810 909m - GBP/USD: GBP amounts 1.2700 495m 1.2750 594m - USD/JPY: USD amounts 156.00 1.4b 156.20 616m 156.80 703m 158.10 693m - USD/CHF: USD amounts 0.8850 720m 0.8900 705m 0.8950 1.3b 0.9000 949m - AUD/USD: AUD amounts 0.6630 1b 0.6650 1.3b - USD/CAD: USD amounts 1.3670 801m 1.3675 949m 1.3700 978m 1.3750 1.5b 1.3775 726m 1.3800 505m

FX option expiries for June 13 NY cut at 10:00 Eastern Time, via DTCC, can be found below - EUR/USD: EUR amounts 1.0685 899m 1.0750 1.3b 1.0775 1.8b 1.0780 2b 1.0800 1.2b 1.0810 909m - GBP/USD: GBP amounts      1.2700 495m 1.2750 594m - USD/JPY: USD amounts                      156.00 1.4b 156.20 616m 156.80 703m 158.10 693m - USD/CHF: USD amounts      0.8850 720m 0.8900 705m 0.8950 1.3b 0.9000 949m - AUD/USD: AUD amounts 0.6630 1b 0.6650 1.3b - USD/CAD: USD amounts        1.3670 801m 1.3675 949m 1.3700 978m 1.3750 1.5b 1.3775 726m 1.3800 505m

The EUR/JPY cross gathers strength around 169.75 during the early European session on Thursday.

EUR/JPY trades on a stronger note near 169.75 in Thursday’s early European session, gaining 0.22% on the day. The cross maintains a positive stance above the key 100-period EMA, with a bullish RSI indicator. The first upside barrier is seen at the 170.00 psychological mark; the initial support level is seen at 169.32. The EUR/JPY cross gathers strength around 169.75 during the early European session on Thursday. The uncertainty that the Bank of Japan (BoJ) will announce a reduction in monthly government bond purchases amid a weaker economy continues to undermine the Japanese Yen (JPY) and create a tailwind for EUR/JPY. Market players await the Bank of Japan (BoJ) monetary policy meeting on Friday, which is widely expected to leave interest rates unchanged. 

According to the 4-hour chart, EUR/JPY keeps the bullish vibe unchanged as the cross is above the key 100-period Exponential Moving Averages (EMA). The upward momentum is supported by the Relative Strength Index (RSI), which stands in bullish territory near 58.0, supporting the buyers for the time being. 

A decisive break above 169.75, the upper boundary of Bollinger Band, will attract some buyers to the 170.00 psychological level. Further north, the additional upside filter to watch is 170.85, a high of June 3, en route to an all-time high of 171.60.   

On the downside, the initial support level is located at 169.32, the 100-period EMA. A breach of the mentioned level could pave the way to 168.75, a low of June 12. Extended losses will see a drop to 168.40, the lower limit of Bollinger Band.  EUR/JPY 4-hour chartEUR/JPY Overview Today last price 169.74 Today Daily Change 0.34 Today Daily Change % 0.20 Today daily open 169.4   Trends Daily SMA20 169.65 Daily SMA50 167.42 Daily SMA100 164.72 Daily SMA200 161.78   Levels Previous Daily High 169.59 Previous Daily Low 168.66 Previous Weekly High 170.89 Previous Weekly Low 168.01 Previous Monthly High 170.8 Previous Monthly Low 164.02 Daily Fibonacci 38.2% 169.23 Daily Fibonacci 61.8% 169.02 Daily Pivot Point S1 168.85 Daily Pivot Point S2 168.29 Daily Pivot Point S3 167.92 Daily Pivot Point R1 169.77 Daily Pivot Point R2 170.14 Daily Pivot Point R3 170.7    

USD/CHF retraces its losses from the previous session after the hawkish hold from the US Federal Reserve (Fed).

USD/CHF gained ground as FOMC left its benchmark lending rate in the range of 5.25%–5.50% on Wednesday.Powell stated, “We don't see ourselves as having the confidence that would warrant policy loosening at this time.”Swiss Franc may see limited downside as SNB is unlikely to implement a rate cut in June.USD/CHF retraces its losses from the previous session after the hawkish hold from the US Federal Reserve (Fed). The Federal Open Market Committee (FOMC) left its benchmark lending rate in the range of 5.25%–5.50% for the seventh consecutive time in its policy meeting on Wednesday, as widely anticipated. The pair edges higher to near 0.8950 during the Asian session on Thursday. However, the Greenback faced challenges after the release of the softer inflation figures from the United States (US). The US Consumer Price Index (CPI) rose 3.3% year-over-year in May, slightly below both the previous reading and expectations of 3.4%. The core CPI, which excludes volatile food and energy prices, increased by 3.4% year-over-year in May, compared to a 3.6% rise in April and an estimated 3.5%. In a press conference following the Fed's decision, Fed Chair Jerome Powell noted that the restrictive stance on monetary policy is having the expected effect on inflation. "So far this year, we have not gained greater confidence on inflation to warrant a rate cut," Powell added. On the Swiss side, the Swiss National Bank (SNB) is unlikely to implement an interest rate cut in June, which is likely to provide support for the Swiss Franc (CHF). Previously, SNB Chairman Thomas J. Jordan warned of minor upside risks to inflation expectations. Traders are anticipating the SNB Financial Stability Report on Thursday, which will offer an assessment of the banking sector's stability and the financial market infrastructure. Additionally, attention will be on Producer and Import Prices data. USD/CHF Overview Today last price 0.8955 Today Daily Change 0.0011 Today Daily Change % 0.12 Today daily open 0.8944   Trends Daily SMA20 0.904 Daily SMA50 0.9074 Daily SMA100 0.8948 Daily SMA200 0.8894   Levels Previous Daily High 0.8984 Previous Daily Low 0.8893 Previous Weekly High 0.9036 Previous Weekly Low 0.8881 Previous Monthly High 0.9225 Previous Monthly Low 0.8988 Daily Fibonacci 38.2% 0.8928 Daily Fibonacci 61.8% 0.8949 Daily Pivot Point S1 0.8897 Daily Pivot Point S2 0.885 Daily Pivot Point S3 0.8807 Daily Pivot Point R1 0.8988 Daily Pivot Point R2 0.9031 Daily Pivot Point R3 0.9078    

The GBP/USD pair edges lower during the Asian session on Thursday and retreats further from over a three-month top, around the 1.2860 region touched the previous day, in reaction to softer US consumer inflation figures.

GBP/USD drifts lower on Thursday amid the hawkish Fed-inspired USD buying interest.The mixed technical setup warrants some caution before positioning for deeper losses.A daily close above the 1.2800 mark will set the stage for a further appreciating move.The GBP/USD pair edges lower during the Asian session on Thursday and retreats further from over a three-month top, around the 1.2860 region touched the previous day, in reaction to softer US consumer inflation figures. Spot prices, for now, seem to have snapped a three-day winning streak and currently trade around the 1.2785 area, down 0.10% for the day. The US Dollar (USD) builds on the overnight bounce from the weekly low in the wake of the Federal Reserve's (Fed) hawkish surprise, indicating that fewer rate cuts were needed this year. Moreover, flash figures published on Wednesday showed that the UK economic growth stalled in April after the muted rebound from last year’s recession. This, in turn, is seen undermining the British Pound (GBP) and contributing to the offered tone surrounding the GBP/USD pair.  From a technical perspective, the recent repeated failures to find acceptance above the 1.2800 mark warrant some caution for bullish traders ahead of the UK national election on July 4. That said, mixed oscillators on the daily chart make it prudent to wait for strong follow-through selling before confirming that the recent strong rally from the YTD trough touched in April has run its course and positioning for any meaningful depreciating move for the GBP/USD pair. Meanwhile, any further decline is more likely to find some support near the 1.2755-1.2750 horizontal zone, below which spot prices could slide to the 1.2715-1.2710 intermediate support. The downfall could extend further towards the 1.2690-1.2685 region en route to the 100-day Simple Moving Average (SMA) support, currently pegged near the 1.2640-1.2635 area. A convincing break below the latter will be seen as a fresh trigger for bears and pave the way for further losses. On the flip side, positive momentum back above the 1.2800 mark might continue to face resistance near the 1.2855-1.2860 region. A sustained strength beyond should allow the GBP/USD pair to retest the YTD peak, around the 1.2900 neighborhood touched in March, and climb further towards the 1.2950 resistance before aiming to reclaim the 1.3000 psychological mark for the first time since July 2023. GBP/USD daily chartGBP/USD Overview Today last price 1.2784 Today Daily Change -0.0014 Today Daily Change % -0.11 Today daily open 1.2798   Trends Daily SMA20 1.274 Daily SMA50 1.2609 Daily SMA100 1.2639 Daily SMA200 1.2548   Levels Previous Daily High 1.286 Previous Daily Low 1.2733 Previous Weekly High 1.2818 Previous Weekly Low 1.2695 Previous Monthly High 1.2801 Previous Monthly Low 1.2446 Daily Fibonacci 38.2% 1.2812 Daily Fibonacci 61.8% 1.2782 Daily Pivot Point S1 1.2734 Daily Pivot Point S2 1.267 Daily Pivot Point S3 1.2606 Daily Pivot Point R1 1.2861 Daily Pivot Point R2 1.2925 Daily Pivot Point R3 1.2989    

EUR/USD remains stable following the trimming of losses registered in the previous session.

EUR/USD remains stable as Eurozone Industrial Production is anticipated to decline on a monthly basis.The US Dollar advances following a hawkish hold from the Fed on Wednesday.Fed Chair Jerome Powell stated, “We don't see ourselves as having the confidence that would warrant policy loosening at this time.”EUR/USD remains stable following the trimming of losses registered in the previous session. The EUR/USD pair trades around 1.0810 during the Asian hours on Thursday. Eurozone Industrial Production figures for April are scheduled for Thursday, with median market forecasts anticipating a decline to 0.2% month-over-month, down from the previous 0.6%. Traders will likely observe the Eurogroup Meeting and several speeches from European Central Bank (ECB) policymakers on Thursday and Friday. On the other side, the US Dollar (USD) advances following a hawkish hold from the US Federal Reserve (Fed). The Federal Open Market Committee (FOMC) left its benchmark lending rate in the range of 5.25%–5.50% for the seventh consecutive time in its policy meeting on Wednesday, as widely anticipated. In a press conference following the Fed's decision, Fed Chair Jerome Powell noted that the restrictive stance on monetary policy is having the expected effect on inflation. "So far this year, we have not gained greater confidence on inflation to warrant a rate cut." "We will need to see more positive data to bolster confidence in inflation control. We don't see ourselves as having the confidence that would warrant policy loosening at this time," Powell added. The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, edges higher to near 104.80, possibly supported by the rebound in the US Treasury yields. 2-year and 10-year yields on US Treasury bonds stand at 4.76% and 4.31%, respectively, by the press time. Investors await the US weekly Initial Jobless Claims and Producer Prices Index (PPI) on Thursday to gain further impetus on economic conditions in the United States (US). EUR/USD Overview Today last price 1.0807 Today Daily Change -0.0002 Today Daily Change % -0.02 Today daily open 1.0809   Trends Daily SMA20 1.0839 Daily SMA50 1.0778 Daily SMA100 1.0804 Daily SMA200 1.0789   Levels Previous Daily High 1.0852 Previous Daily Low 1.0735 Previous Weekly High 1.0916 Previous Weekly Low 1.08 Previous Monthly High 1.0895 Previous Monthly Low 1.065 Daily Fibonacci 38.2% 1.0807 Daily Fibonacci 61.8% 1.078 Daily Pivot Point S1 1.0745 Daily Pivot Point S2 1.0681 Daily Pivot Point S3 1.0627 Daily Pivot Point R1 1.0863 Daily Pivot Point R2 1.0916 Daily Pivot Point R3 1.098    

West Texas Intermediate (WTI) US crude Oil prices trade with a mild negative bias during the Asian session on Thursday, albeit lack bearish conviction and remain well within the striking distance of a nearly two-week high touched the previous day.

WTI is undermined by a surprise build in US inventories and lower demand growth forecast by IEA.The Fed’s hawkish surprise lifts the USD and weighs on the dollar-denominated commodity.The lack of strong follow-through selling warrants caution before positioning for deeper losses.West Texas Intermediate (WTI) US crude Oil prices trade with a mild negative bias during the Asian session on Thursday, albeit lack bearish conviction and remain well within the striking distance of a nearly two-week high touched the previous day.  Official data published by the Energy Information Administration (EIA) on Wednesday showed that US Crude inventories grew by 3.7 million barrels in the first week of June. Adding to this, the International Energy Agency (EIA), in its monthly report, trimmed the outlook for Oil demand growth in 2024 by 100,000 barrels per day to 960,000 bpd. Apart from this, some follow-through US Dollar (USD) buying, bolstered by the Federal Reserve's (Fed) hawkish surprise, further seems to undermine USD-denominated commodities, including Crude Oil prices. The Fed kept interest rates unchanged at the end of a two-day policy meeting and now see the benchmark rate falling to 5.1% this year, suggesting just one rate cut in 2024 as compared to three estimated in March. The shift in projection provides a modest lift to the US Treasury bond yields and assists the USD to build on the overnight bounce from the weekly low touched in the aftermath of softer US consumer inflation figures. That said, persistent geopolitical tensions in the Middle East might continue to lend some support to Crude Oil prices and limit losses.  Market participants now look to the US economic docket, featuring the release of the Producer Price Index (PPI) and the usual Weekly Initial Jobless Claims data later during the early North American session. This, along with the US bond yields and the broader risk sentiment, will influence the USD and provide some impetus to Oil prices. The aforementioned fundamental backdrop, meanwhile, warrants some caution before positioning for a firm near-term direction. WTI US OIL Overview Today last price 77.84 Today Daily Change -0.14 Today Daily Change % -0.18 Today daily open 77.98   Trends Daily SMA20 77.25 Daily SMA50 80.04 Daily SMA100 79.23 Daily SMA200 79.27   Levels Previous Daily High 78.98 Previous Daily Low 77.59 Previous Weekly High 77.36 Previous Weekly Low 72.46 Previous Monthly High 81.25 Previous Monthly Low 76.04 Daily Fibonacci 38.2% 78.45 Daily Fibonacci 61.8% 78.12 Daily Pivot Point S1 77.39 Daily Pivot Point S2 76.8 Daily Pivot Point S3 76 Daily Pivot Point R1 78.77 Daily Pivot Point R2 79.57 Daily Pivot Point R3 80.16    

China’s FX regulator, the State Administration of Foreign Exchange (SAFE), said in a statement on Thursday, it “will strengthen FX situation monitoring and policy reserves.” Additional quotes Will severely crack down on illegal FX activities.

China’s FX regulator, the State Administration of Foreign Exchange (SAFE), said in a statement on Thursday, it “will strengthen FX situation monitoring and policy reserves.” Additional quotes Will severely crack down on illegal FX activities. Will further improve management of FX reserves. Will effectively safeguard stable operations of forex market, and the national economy, and financial stability. Will steadily promote diversified asset allocation, ensure safety of liquidity and value preservation of FX reserve assets.

Indian Rupee (INR) weakens on Thursday amid the persistent US Dollar (USD) demand from local oil companies and other importers.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Indian Rupee struggles to gain ground on the USD demand on Thursday. The hawkish hold by the Fed supported the Greenback, but the RBI intervention might limit the pair’s upside. The US weekly Initial Jobless Claims, Producer Prices Index (PPI), and Fed’s John Williams speech will be in focus on Thursday.Indian Rupee (INR) weakens on Thursday amid the persistent US Dollar (USD) demand from local oil companies and other importers. The hawkish hold by the US Federal Reserve (Fed) helped the Greenback to regain some composure despite the release of softer-than-expected US May inflation data. The INR encounters a push-pull dynamic driven by multiple market factors. Nonetheless, the foreign exchange (FX) intervention from the Reserve Bank of India (RBI) might curb the Indian Rupee's decline for the time being.

Traders will watch the US weekly Initial Jobless Claims, Producer Prices Index (PPI), and Fed’s John Williams speech, which are due later on Thursday. On Friday, the preliminary US Michigan Consumer Sentiment Index for June will be released. The highlight on Friday will be India’s Wholesale Price Index (WPI) Inflation data. The hotter-than-expected consumer inflation might lift the Indian Rupee and cap the upside for the pair in the near term.  Daily Digest Market Movers: Indian Rupee edges lower amid various factors India's CPI inflation eased to a 12-month low of 4.75% in May, compared to 4.83% in April, which is softer than the market expectation of 4.90%.  The US headline Consumer Price Index (CPI) inflation eased to 3.3% on a yearly basis in May from 3.4% in April, below the market consensus of 3.4%. The core CPI figure, which excludes volatile food and energy prices, rose 3.4%, compared to a 3.6% rise in April and the estimation of 3.5%. On a monthly basis, the core CPI increased 0.2% in May. The Federal Open Market Committee (FOMC) decided to keep its benchmark lending rate in a range of 5.25%–5.50% for the seventh time in a row at its June meeting on Wednesday.  The so-called ‘dot-plot’ showed that the median of FOMC officials revised their forecast of the federal funds rate from 4.6% to 5.1% toward the end of 2024. Fed Chair Jerome Powell said on Wednesday during the press conference that the restrictive stance on monetary policy is affecting inflation, which the Fed had hoped to see, but the central bank will wait to see sufficient progress on inflation. Technical analysis: USD/INR displays a bullish vibe in the longer term The Indian Rupee trades in negative territory on the day. The constructive outlook of the USD/INR pair remains intact as the pair holds above the key 100-day Exponential Moving Average (EMA) and descending trend channel upper boundary on the daily timeframe. 

USD/INR is likely to extend the consolidative mode in the near term as the 14-day Relative Strength Index (RSI) still hovers around the 50-midline, indicating the neutral momentum of the pair. 

In the bullish event, the immediate upside barrier is located at 83.60, a high of June 11. Then, the pair could extend its upswing to 83.72, a high of April 17. The next hurdle will emerge at the 84.00 round mark.   

A break below the crucial support at 83.35, the confluence of the 100-day EMA and descending trend channel upper boundary, could mark the start of a reversal from the uptrend. The next contention level is seen at the 83.00 psychological level, followed by 82.78, a low of January 15.  US Dollar price today The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the New Zealand Dollar.  USDEURGBPCADAUDJPYNZDCHFUSD  0.04% 0.04% 0.12% 0.14% 0.13% 0.17% 0.07%EUR-0.03%   -0.01% 0.09% 0.10% 0.09% 0.13% 0.03%GBP-0.05% 0.01%   0.09% 0.08% 0.07% 0.10% 0.01%CAD-0.12% -0.07% -0.06%   -0.02% -0.01% 0.05% -0.07%AUD-0.14% -0.08% -0.08% 0.00%   -0.01% 0.04% -0.07%JPY-0.13% -0.07% -0.07% 0.01% 0.00%   0.05% -0.06%NZD-0.17% -0.12% -0.13% -0.05% -0.04% -0.06%   -0.12%CHF-0.06% 0.00% -0.01% 0.08% 0.08% 0.07% 0.12%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.  

The Japanese Yen (JPY) retraces its recent gains on Thursday as the US Dollar (USD) advances following a hawkish hold from the US Federal Reserve (Fed), boosting the USD/JPY pair.

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The Federal Open Market Committee (FOMC) left its benchmark lending rate in the range of 5.25%–5.50% for the seventh consecutive time in its policy meeting on Wednesday, as widely anticipated. The Japanese Yen may see limited downside as caution prevails ahead of the Bank of Japan’s (BoJ) policy decision on Friday. While the BoJ is widely expected to leave interest rates unchanged, traders will be closely monitoring any announcements regarding a potential reduction in the central bank's monthly bond purchases. The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, recovers its recent losses. This recovery can be attributed to the hawkish stance of the Federal Reserve. FOMC policymakers now anticipate just one rate cut this year, down from the three that were projected in March. The CME FedWatch Tool indicates that the likelihood of a Fed rate cut in September by at least 25 basis points has decreased to 61.5, down from 69.4% a week earlier. Investors await the US weekly Initial Jobless Claims and Producer Prices Index (PPI) on Thursday to gain further impetus on economic conditions in the United States (US). Daily Digest Market Movers: Japanese Yen declines as Fed adopts a hawkish stance In a press conference following the Fed's decision, Fed Chair Jerome Powell remarked that the restrictive stance on monetary policy is producing the expected effects on inflation. The US Consumer Price Index (CPI) rose 3.3% year-over-year in May, slightly below both the previous reading and expectations of 3.4%. The core CPI, which excludes volatile food and energy prices, increased by 3.4% year-over-year in May, compared to a 3.6% rise in April and an estimated 3.5%. Japanese Producer Price Index (PPI) data showed that producer prices jumped 2.4% year-on-year in May, exceeding market expectations of a 2.0% rise, fueling concerns that this might lead to higher consumer inflation. Japan Finance Minister Shunichi Suzuki said on Tuesday it is important to continue efforts to achieve economic growth and attain fiscal health to retain confidence in the country's fiscal policy, per Reuters. Nearly two-thirds of economists surveyed in a Reuters poll on Tuesday anticipate that the Bank of Japan will opt to commence tapering its monthly bond purchases at Friday's policy meeting. This decision marks a significant initial move aimed at gradually reducing the central bank's burgeoning balance sheet. Takeshi Minami, Chief Economist at Norinchukin Research Institute said, "There is no longer any reason to continue large-scale purchases of government bonds since it has been judged that a 2% rise in prices is within reach," per Reuters. According to Reuters, while speaking to parliament last week, Bank of Japan (BoJ) Governor Kazuo Ueda stated that inflation expectations are gradually rising but have yet to reach 2%. "We have been scrutinizing market developments since the March decision. As we proceed to exit our massive monetary stimulus, it's appropriate to reduce bond purchases," Ueda said. Technical Analysis: USD/JPY could test the key level of 157.00 USD/JPY trades around 156.90 on Thursday. Analysis of the daily chart indicates a bullish inclination as the pair consolidates within an ascending channel pattern. Moreover, the 14-day Relative Strength Index (RSI) is above the 50 level, suggesting a tendency for upward momentum. An immediate hurdle is noticeable at the psychological level of 157.00. A breakthrough above this level could provide support, potentially guiding the USD/JPY pair toward the vicinity of the significant level of 158.00, following the upper boundary near 158.80. Further resistance is observed at 160.32, marking its highest level in over thirty years. On the downside, the lower boundary of the ascending channel is near the 50-day Exponential Moving Average (EMA) at 155.09. A breach below this level could intensify downward pressure on the USD/JPY pair, potentially driving it toward the throwback support area around 152.80. USD/JPY: Daily ChartJapanese Yen price today The table below shows the percentage change of the Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the weakest against the US Dollar.  USDEURGBPCADAUDJPYNZDCHFUSD  0.04% 0.06% 0.12% 0.18% 0.13% 0.22% 0.06%EUR-0.05%   0.00% 0.09% 0.13% 0.09% 0.18% 0.02%GBP-0.07% -0.01%   0.07% 0.10% 0.05% 0.16% -0.01%CAD-0.13% -0.08% -0.06%   0.04% -0.01% 0.10% -0.08%AUD-0.18% -0.13% -0.11% -0.05%   -0.06% 0.05% -0.12%JPY-0.13% -0.07% -0.05% 0.01% 0.06%   0.10% -0.06%NZD-0.22% -0.18% -0.16% -0.10% -0.06% -0.11%   -0.18%CHF-0.06% 0.00% 0.01% 0.07% 0.12% 0.06% 0.18%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation. How does the differential between Japanese and US bond yields impact the Japanese Yen? The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.  

Gold prices (XAU/USD) gained positive traction for the third successive day on Wednesday and touched a fresh weekly peak, around the $2,341-2,342 area in reaction to softer US consumer inflation figures.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Gold price attracts fresh sellers on Thursday and snaps a three-day winning streak.The Fed’s outlook of fewer rate cuts this year is seen weighing on the commodity.Traders now look to the US PPI and Initial Jobless Claims for short-term impetus.Gold prices (XAU/USD) gained positive traction for the third successive day on Wednesday and touched a fresh weekly peak, around the $2,341-2,342 area in reaction to softer US consumer inflation figures. The momentum, however, ran out of steam in the vicinity of the 50-day Simple Moving Average (SMA) support-turned-resistance after the Federal Reserve's (Fed) hawkish surprise. In fact, policymakers now see just one rate cut in 2024 as compared to three projected in March, which, in turn, is seen exerting some follow-through pressure on the non-yielding yellow metal during the Asian session on Thursday. Meanwhile, the shift in the Fed's projections, which led to a modest uptick in the US Treasury bond yields, assists the US Dollar (USD) to build on the overnight bounce from a multi-day low and further undermines the Gold price. That said, geopolitical tension in the Middle East and political uncertainty in Europe should lend some support to the XAU/USD. Nevertheless, the broader fundamental backdrop suggests that the path of least resistance for the XAU/USD is to the downside. Traders now look to Thursday's US economic docket – featuring the Producer Price Index (PPI) and Weekly Initial Jobless Claims data. Daily Digest Market Movers: Gold price is pressured by Fed’s hawkish bias and modest USD strength The initial market reaction to the softer US consumer inflation data on Wednesday faded rather quickly after the Federal Reserve said that it sees only one rate cut this year, which, in turn, is seen undermining the non-yielding Gold price.  The US Bureau of Labor Statistics (BLS) reported that inflation, as measured by the change in the Consumer Price Index (CPI), was unchanged in May for the first time since last June, and the yearly rate edged down to 3.3% from 3.4%. The annual core CPI, which excludes volatile food and energy prices, was up 0.2% during the reported month and rose 3.4% on a yearly basis as compared to the 3.6% increase in April and consensus estimates for a reading of 3.5%. The Fed kept interest rates unchanged at the end of a two-day policy meeting and projected the benchmark rate falling to 5.1% this year, suggesting just one rate cut in 2024 as against a prior estimate of three cuts at the March meeting. Adding to this, the Fed lifted its forecast on the neutral rate to 2.8% from 2.6% previously, providing a modest lift to the US Dollar and contributing to driving flows away from the USD-denominated commodity.  French President Emmanuel Macron's decision to call snap elections later this month increased political uncertainty in the Eurozone's second-biggest economy and could lend support to the safe-haven precious metal.  Thursday's US macro data could produce short-term trading opportunities later during the early North American session ahead of the Bank of Japan (BoJ) policy decision on Friday, which could infuse volatility in the market. Technical Analysis: Gold price could accelerate the fall once the $2,285 horizontal support is broken From a technical perspective, the overnight failure near the 50-day SMA support-turned-resistance and the subsequent slide favors bearish traders. Moreover, oscillators on the daily chart are holding in negative territory and support prospects for a further depreciating move for the Gold price. That said, any further decline is likely to find some support near the $2,300 mark ahead of the $2,285 horizontal zone. Some follow-through selling will be seen as a fresh trigger for bearish traders and make the XAU/USD vulnerable to accelerate the fall towards the next relevant support near the $2,254-2,253 region. The downward trajectory could extend further towards the $2,225-2,220 area en route to the $2,200 round figure. On the flip side, any strength beyond the $2,325 hurdle might continue to attract fresh sellers and remain capped near the 50-day SMA support breakpoint, currently pegged near the $2,345 region. This is followed by the $2,360-2,362 supply zone, which, if cleared decisively, should allow the Gold price to retest last week’s swing high, around the $2,387-2,388 area and aim to reclaim the $2,400 mark. A sustained strength beyond the latter will negate any near-term negative bias and pave the way for some meaningful appreciating move in the near term. Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.  

The Australian Dollar (AUD) inched higher following the employment data release on Thursday.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Australian Dollar appreciated due to the higher-than-expected Employment Change.Australia’s Unemployment Rate dropped to 4.0%, from April’s 4.1% rate as expected.The US Dollar recovers losses as FOMC leaves its benchmark lending rate in a range of 5.25%–5.50% for the seventh time in a row.The Australian Dollar (AUD) inched higher following the employment data release on Thursday. Australia’s Employment Change showed that the number of employed people increased by 39.7K in May, exceeding the expected 30.0K increase and the previous 38.5K rise. Meanwhile, the Unemployment Rate came in at 4.0%, below April’s 4.1% rate as expected. The US Dollar (USD) recovers its recent losses after the hawkish hold from the US Federal Reserve (Fed), undermining the AUD/USD pair. Investors await the US weekly Initial Jobless Claims and Producer Prices Index (PPI) on Thursday to gain further impetus on economic conditions in the United States (US). The Federal Open Market Committee (FOMC) left its benchmark lending rate in a range of 5.25%–5.50% for the seventh time in a row at its June meeting on Wednesday, as widely expected. Daily Digest Market Movers: Australian Dollar inches higher due to positive labor data In a press conference post Fed decision, Fed Chair Jerome Powell noted that the restrictive stance on monetary policy is having the effect on inflation that the central bank had expected. Additionally, FOMC policymakers expect just one rate cut this year, down from three in March. US Consumer Price Index (CPI) rose 3.3% YoY in May, compared to the previous reading and the expectations of 3.4%. The core CPI, excluding volatile food and energy prices, increased 3.4% YoY in May, compared to a 3.6% rise in April and the estimation of 3.5%. On Wednesday, China’s CPI increased by 0.3% year-over-year in May, missing expectations for a 0.4% rise. Inflation decreased by 0.1% MoM versus April’s 0.1% increase. Australian Treasurer Jim Chalmers stated that the visit of China's Premier Li Qiang to Australia is an important opportunity. Chalmers noted underlying weaknesses in China's economy and expressed that he does not expect China's economy to recover immediately. Australia's NAB Business Confidence index dropped to -3 index points in May, marking the lowest figure in six months and turning negative for the first time since last November. Meanwhile, Business Conditions fell to 6 index points, slightly below the long-run average. On Tuesday, National Australia Bank (NAB) Chief Economist Alan Oster commented, “There are warning signs on the outlook for growth but at the same time reasons to be very wary about the inflation outlook, and they expect the RBA to keep rates on hold for some time yet as they navigate through these contrasting risks,” as per the official transcript. Last week, RBA Governor Michele Bullock indicated that the central bank is prepared to increase interest rates if the Consumer Price Index (CPI) does not return to the target range of 1%-3%, according to NCA NewsWire. Technical Analysis: Australian Dollar hovers around 0.6650 The Australian Dollar trades around 0.6660 on Thursday. Analysis of the daily chart indicates a neutral bias for the AUD/USD pair as it consolidates within the horizontal channel pattern. The 14-day Relative Strength Index (RSI) is positioned slightly below the 50 level. A further movement may suggest a clear directional trend. Immediate support region is identified around the 50-day Exponential Moving Average (EMA) at 0.6604, followed by the lower boundary of the horizontal channel around the level of 0.6585. On the upside, the AUD/USD pair could explore the region around the upper threshold of the horizontal channel around the level of 0.6700, followed by May’s high of 0.6714. AUD/USD: Daily ChartAustralian Dollar price today The table below shows the percentage change of the Australian Dollar (AUD) against listed major currencies today. The Australian Dollar was the strongest against the New Zealand Dollar.  USDEURGBPCADAUDJPYNZDCHFUSD  0.05% 0.05% 0.09% 0.10% 0.01% 0.16% 0.05%EUR-0.05%   -0.01% 0.05% 0.06% -0.04% 0.11% 0.01%GBP-0.06% 0.00%   0.04% 0.06% -0.06% 0.11% -0.02%CAD-0.09% -0.04% -0.04%   0.02% -0.10% 0.07% -0.06%AUD-0.10% -0.06% -0.04% -0.02%   -0.12% 0.05% -0.08%JPY0.00% 0.03% 0.06% 0.10% 0.07%   0.15% 0.05%NZD-0.15% -0.11% -0.11% -0.06% -0.06% -0.18%   -0.13%CHF-0.05% 0.02% 0.02% 0.06% 0.06% -0.04% 0.13%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Australian Dollar FAQs What key factors drive the Australian Dollar? One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar? The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar? China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar? Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar? The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.  

Australia Part-Time Employment: -2.1K (May) vs previous 44.6K

Australia Participation Rate above forecasts (66.7%) in May: Actual (66.8%)

Australia Full-Time Employment: 41.7K (May) vs -6.1K

Australia Employment Change s.a. came in at 39.7K, above forecasts (30K) in May

Australia Unemployment Rate s.a. in line with forecasts (4%) in May

The People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead on Thursday at 7.1122, as against the previous day's fix of 7.1133 and 7.2384 Reuters estimates.

The People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead on Thursday at 7.1122, as against the previous day's fix of 7.1133 and 7.2384 Reuters estimates.

The USD/CAD pair snaps the three-day losing streak near 1.3730 during the early Asian trading hours on Thursday.

USD/CAD recovers to 1.3730 amid the firmer US Dollar in Thursday’s early Asian session. The FOMC held rate steady for the seventh time in a row at its June meeting on Wednesday. BoC’s Macklem said there is a limit to how far BoC can diverge on rates from Fed, but the’re not close to that. The USD/CAD pair snaps the three-day losing streak near 1.3730 during the early Asian trading hours on Thursday. The renewed US Dollar (USD) demand after the hawkish hold from the US Federal Reserve (Fed) provides some support to the pair. Investors will watch the US weekly Initial Jobless Claims, Producer Prices Index (PPI), and Fed’s John Williams speech, which are due later on Thursday. 

The Federal Open Market Committee (FOMC) left its benchmark lending rate in a range of 5.25%–5.50% for the seventh time in a row at its June meeting on Wednesday, as widely expected by market players. During the press conference, Fed Chair Jerome Powell noted that the restrictive stance on monetary policy is having the effect on inflation that the Fed had hoped to see, but the central bank will wait to see sufficient progress about inflation. Additionally, FOMC policymakers expect just one rate cut this year, down from three in March, according to its most recent economic predictions.

About the data, the US Consumer Price Index (CPI) rose 3.3% YoY in May, compared to the previous reading and the expectations of 3.4%. The core CPI, excluding volatile food and energy prices, increased 3.4% YoY in May, compared to a 3.6% rise in April and the estimation of 3.5%

On the Loonie front, the Bank of Canada (BoC) Governor Tiff Macklem said late Wednesday that there is a limit to how far the Canadian central bank can diverge on rates from the Federal Reserve (Fed), but they’re not close to that limit. The BoC lowered its benchmark rate by 25 basis points (bps) to 4.75% last week. The markets have priced in nearly 150 bps of additional cuts over the next couple of years. The divergence of interest rates between Canada and the US might boost the Greenback against the Canadian Dollar (USD) and support the pair in the near term.  USD/CAD Overview Today last price 1.3729 Today Daily Change 0.0005 Today Daily Change % 0.04 Today daily open 1.3724   Trends Daily SMA20 1.3679 Daily SMA50 1.3685 Daily SMA100 1.3598 Daily SMA200 1.358   Levels Previous Daily High 1.3761 Previous Daily Low 1.368 Previous Weekly High 1.3768 Previous Weekly Low 1.3603 Previous Monthly High 1.3783 Previous Monthly Low 1.359 Daily Fibonacci 38.2% 1.3711 Daily Fibonacci 61.8% 1.373 Daily Pivot Point S1 1.3682 Daily Pivot Point S2 1.3641 Daily Pivot Point S3 1.3601 Daily Pivot Point R1 1.3763 Daily Pivot Point R2 1.3802 Daily Pivot Point R3 1.3844    

The USD/JPY pair ticks higher during the Asian session on Thursday and looks to build on the overnight bounce from the 155.70 area or a multi-day low touched in reaction to softer US consumer inflation figures.

USD/JPY attracts some buyers on Thursday, albeit the uptick lacks follow-through.The Fed’s hawkish outlook overshadowed the softer US CPI and lends some support.Traders seem reluctant and look to the BoJ decision before placing directional bets.The USD/JPY pair ticks higher during the Asian session on Thursday and looks to build on the overnight bounce from the 155.70 area or a multi-day low touched in reaction to softer US consumer inflation figures. Spot prices, however, lack bullish conviction and currently trade around the 156.75-156.80 region as the focus now shifts to the Bank of Japan (BoJ) policy meeting. Heading into the key central bank event risk, the Federal Reserve's (Fed) hawkish surprise on Wednesday acts as a tailwind for the US Dollar (USD) and turns out to be a key factor lending some support to the USD/JPY pair. In fact, policymakers believed that fewer rate cuts were needed this year as inflation is expected to trend higher than previously estimated and now see just one rate cut in 2024 as compared to three projected in March.  The outlook, to a larger extent, overshadowed the softer US Consumer Price Index (CPI) print, which was unchanged in May, for the first time since last June, and edged down to 3.3% on a yearly basis from 3.4% in April. Furthermore, the US Bureau of Labor Statistics (BLS) reported that the annual core CPI, which excludes volatile food and energy prices, fell to a more than three-year low of 3.4% as compared to the 3.6% in April and 3.5% expected.  Nevertheless, the shift in the Fed's projections should underpin the USD and support prospects for a further appreciating move for the USD/JPY pair. Bulls, however, seem reluctant amid uncertainty if the BoJ will announce a reduction in the monthly government bond purchases amid a weaker economy. Hence, the focus will remain on the outcome of the highly-anticipated two-day BoJ meeting, scheduled to be announced on Friday.  In the meantime, Thursday's US economic docket – featuring the Producer Price Index (PPI) and the usual Weekly Initial Jobless Claims data – will be looked upon for short-term trading opportunities later during the early North American session. Apart from this, the broader risk sentiment, which tends to drive demand for the safe-haven Japanese Yen (JPY) might provide some impetus to the USD/JPY pair. USD/JPY Overview Today last price 156.82 Today Daily Change 0.09 Today Daily Change % 0.06 Today daily open 156.73   Trends Daily SMA20 156.52 Daily SMA50 155.33 Daily SMA100 152.48 Daily SMA200 149.97   Levels Previous Daily High 157.37 Previous Daily Low 155.72 Previous Weekly High 157.47 Previous Weekly Low 154.55 Previous Monthly High 157.99 Previous Monthly Low 151.86 Daily Fibonacci 38.2% 156.35 Daily Fibonacci 61.8% 156.74 Daily Pivot Point S1 155.84 Daily Pivot Point S2 154.95 Daily Pivot Point S3 154.19 Daily Pivot Point R1 157.49 Daily Pivot Point R2 158.26 Daily Pivot Point R3 159.14    

The NZD/USD pair extends the rally around 0.6195 despite the weaker US Dollar (USD) on Thursday during the early Asian session.

NZD/USD trades in positive territory for the fourth consecutive day near 0.6195 on Thursday. Fed held interest rates steady at its June meeting but revised its outlook to one rate cut in 2024. The hawkish stance of the Reserve Bank of New Zealand’s (RBNZ) continues to support the Kiwi against the USD. The NZD/USD pair extends the rally around 0.6195 despite the weaker US Dollar (USD) on Thursday during the early Asian session. The softer-than-expected US Consumer Price Index (CPI) inflation report in May has dragged the USD Index (DXY) lower to 104.25, but the hawkish hold by the Federal Reserve (Fed) helped the DXY to regain some composure.

Inflation in the United States cooled more than expected in May, the US Bureau of Labor Statistics (BLS) showed on Wednesday. The Consumer Price Index rose 3.3% YoY in May, compared to the previous reading and expectations of 3.4%. On a monthly basis, the CPI figure held flat in May, the first time since July 2022, compared to a 0.3% gain in April.

The core CPI, which excludes volatile food and energy prices, rose 3.4% YoY in May, compared to a 3.6% rise in April and the estimation of 3.5%. On a monthly basis, the core CPI increased 0.2% MoM in May. 

The softer CPI report has boosted chances for Fed cuts this year and exerted some selling pressure on the USD. Investors are now pricing in a 73% chance of a rate cut from the Fed in September, up from 53% before the CPI data was released, according to the CME FedWatch tool.

Apart from this, the Fed held interest rates steady at their current range of 5.25% to 5.5% at its June meeting on Wednesday, as widely expected by market players. Fed Chair Jerome Powell said that the restrictive stance on monetary policy is having the effect on inflation that central bankers had hoped to see, but the Fed will wait to see sufficient progress. The Greenback recovers some lost ground following the hawkish hold of the Fed. 

On the other hand, China’s CPI inflation remained steady in May at 0.3% YoY, missing expectations for a 0.4% growth in the reported period. Meanwhile, China’s Producer Price Index (PPI) declined 1.4% YoY in May from the previous reading of a 2.5% drop, above the market forecast of a 1.5% decrease. However, the mixed Chinese economic data had little impact on the New Zealand Dollar (NZD), even though China is New Zealand's biggest trading partner. 

The hawkish stance of the Reserve Bank of New Zealand (RBNZ) continues to underpin the Kiwi and create a tailwind for the NZD/USD pair for the time being. The New Zealand central bank is concerned about sticky domestic inflation and has an increased chance of a future hike, while the RBNZ is expected to maintain its current policy stance until at least mid-2025. NZD/USD Overview Today last price 0.6185 Today Daily Change -0.0001 Today Daily Change % -0.02 Today daily open 0.6186   Trends Daily SMA20 0.6139 Daily SMA50 0.6041 Daily SMA100 0.6068 Daily SMA200 0.6058   Levels Previous Daily High 0.6222 Previous Daily Low 0.6122 Previous Weekly High 0.6216 Previous Weekly Low 0.6101 Previous Monthly High 0.6171 Previous Monthly Low 0.5875 Daily Fibonacci 38.2% 0.6184 Daily Fibonacci 61.8% 0.616 Daily Pivot Point S1 0.6131 Daily Pivot Point S2 0.6077 Daily Pivot Point S3 0.6032 Daily Pivot Point R1 0.6231 Daily Pivot Point R2 0.6277 Daily Pivot Point R3 0.6331    

Japan BSI Large Manufacturing Conditions Index (QoQ) came in at -1, above forecasts (-5.2) in 2Q

Japan Foreign Investment in Japan Stocks declined to ¥-346.6B in June 7 from previous ¥282B

Bank of Canada (BoC) Governor Tiff Macklem reiterated on Wednesday that there is a limit to how far the Canadian central bank can diverge on rates from the Federal Reserve (Fed), but they’re not close to that limit.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} Bank of Canada (BoC) Governor Tiff Macklem reiterated on Wednesday that there is a limit to how far the Canadian central bank can diverge on rates from the Federal Reserve (Fed), but they’re not close to that limit.   Key quotes "For many of our citizens, this has been their first experience with high inflation, and it has been painful.”

"We need to meet people where they are and ensure they understand what we’re doing and why we’re doing it.”

"Recent history has been a stark reminder that inflation is our common enemy.”

“It's reasonable to expect more cuts on the horizon, but that the central bank is taking it "one meeting at a time." 

“There are limits to that divergence, but we’re not close to that limit.”  Market reaction  At the time of writing, USD/CAD is trading 0.02% lower on the day to trade at 1.3720.  Bank of Canada FAQs What is the Bank of Canada and how does it influence the Canadian Dollar? The Bank of Canada (BoC), based in Ottawa, is the institution that sets interest rates and manages monetary policy for Canada. It does so at eight scheduled meetings a year and ad hoc emergency meetings that are held as required. The BoC primary mandate is to maintain price stability, which means keeping inflation at between 1-3%. Its main tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Canadian Dollar (CAD) and vice versa. Other tools used include quantitative easing and tightening. What is Quantitative Easing (QE) and how does it affect the Canadian Dollar? In extreme situations, the Bank of Canada can enact a policy tool called Quantitative Easing. QE is the process by which the BoC prints Canadian Dollars for the purpose of buying assets – usually government or corporate bonds – from financial institutions. QE usually results in a weaker CAD. QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The Bank of Canada used the measure during the Great Financial Crisis of 2009-11 when credit froze after banks lost faith in each other’s ability to repay debts. What is Quantitative tightening (QT) and how does it affect the Canadian Dollar? Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the Bank of Canada purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the BoC stops buying more assets, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Canadian Dollar.  

The GBP/USD pair loses some ground near 1.2795 after retracing from three-month highs of 1.2860 during the early Asian session on Thursday.

GBP/USD edges lower to 1.2795 after retreating from three-month highs on Thursday. The Fed kept its benchmark overnight borrowing rate targeted in a range of 5.25%-5.50% on Wednesday, as widely expected. The UK GDP flatlined in April, arriving at 0% after expanding 0.4% in March. The GBP/USD pair loses some ground near 1.2795 after retracing from three-month highs of 1.2860 during the early Asian session on Thursday. The negative surprise of the US Consumer Price Index (CPI) inflation report in May weighs on the Greenback, but the hawkish hold by the Federal Reserve (Fed) modestly caps the USD’s downside. 

Inflation in the United States held flat in May, dragging the US Dollar (USD) lower. The CPI figure eased to 3.3% on a yearly basis in May from 3.4% in April, below the market consensus of 3.4%, the US Bureau of Labor Statistics (BLS) reported on Wednesday. The core CPI, which excludes volatile food and energy prices, increased 3.4%, compared to a 3.6% rise in April and the estimation of 3.5%. On a monthly basis, the CPI was unchanged, while the core CPI increased 0.2% in May.

Furthermore, the Federal Open Market Committee (FOMC) decided to keep its benchmark lending rate in a range of 5.25%-5.50% for the seventh time in a row at its June meeting on Wednesday. The FOMC officials expect just one rate cut this year, down from three in March, according to its most recent economic predictions. The so-called ‘dot-plot’ showed that the median of the FOMC officials revised their forecast of the federal funds rate from 4.6% to 5.1%, towards the end of 2024.

Futures traders are now pricing in a 73% odds of rate cut from the Fed in September, up from 53% before the CPI data released, according to the CME FedWatch tool. Later on Thursday, investors will keep an eye on the US weekly Initial Jobless Claims, along with the Producer Prices Index (PPI) and the Fed's John Williams speech. 

On the other hand, the UK economic growth stalls in April, according to a flash reading published by the Office for National Statistics (ONS) on Wednesday. The UK Gross Domestic Product (GDP) came in at 0% in April after growing 0.4% in March, in line with the market consensus. The Bank of England (BoE) will meet on June 20 for the next move of its monetary policy. Investors believe there is little possibility of a rate cut in June and shift their expectations towards August or September. GBP/USD Overview Today last price 1.2795 Today Daily Change 0.0055 Today Daily Change % 0.43 Today daily open 1.274   Trends Daily SMA20 1.2734 Daily SMA50 1.2606 Daily SMA100 1.2639 Daily SMA200 1.2547   Levels Previous Daily High 1.2752 Previous Daily Low 1.2706 Previous Weekly High 1.2818 Previous Weekly Low 1.2695 Previous Monthly High 1.2801 Previous Monthly Low 1.2446 Daily Fibonacci 38.2% 1.2734 Daily Fibonacci 61.8% 1.2723 Daily Pivot Point S1 1.2713 Daily Pivot Point S2 1.2687 Daily Pivot Point S3 1.2668 Daily Pivot Point R1 1.2759 Daily Pivot Point R2 1.2778 Daily Pivot Point R3 1.2805    

EUR/USD launched higher on Wednesday, climbing after broad-market risk appetite surged following a cooler-than-expected print in US Consumer Price Index (CPI) inflation, but a hawkish tilt to the Federal Reserve’s latest update to its dot plot of interest rate expectations crimped market sentiment to round out the day.

EUR/USD climbed to 1.0850 before facing a pullback after Fed rate call.FOMC “dot plot” teases less rate cuts in 2024 than previously expected.ECB talking points to round out the Euro’s week.EUR/USD launched higher on Wednesday, climbing after broad-market risk appetite surged following a cooler-than-expected print in US Consumer Price Index (CPI) inflation, but a hawkish tilt to the Federal Reserve’s latest update to its dot plot of interest rate expectations crimped market sentiment to round out the day.Forex Today: US inflation dominates headlinesAccording to the Federal Open Market Committee (FOMC) and its Summary of Economic Projections (SEP), only a single quarter-point rate cut is now expected in 2024. Market hopes for Fed rate cuts have steadily clashed with the Federal Reserve’s own rate cut expectations through 2024, and according to the CME’s FedWatch Tool, rate markets are still pricing in over 60% odds of at least a 25 basis-point rate trim on September 18.Read more: Jerome Powell comments on rate outlook after keeping policy settings unchangedEurogroup meetings on Thursday and Friday, pan-European Industrial Production figures, and several speeches from European Central Bank (ECB) policymakers will wrap up the trading week’s Euro events, while US jobless claims and the Michigan Consumer Sentiment Index will provide perspective after the Fed’s latest rate call. European Industrial Production figures for April are slated for Thursday, with median market forecasts expecting figures to ease to 0.2% MoM compared to the previous 0.6%. US Initial Jobles Claims for the week ended June 7 are expected later on Thursday, with investors expecting 225K new jobless claimants compared to the previous week’s 229K. A handful of speeches from ECB central planners smatter Friday’s economic calendar, and the Univeristy of Michigan’s Consumer Sentiment Index for June is expected to recover to 72.0 from 69.1. EUR/USD technical outlook EUR/USD is once again mired in congestion at the 200-day Exponential Moving Average (EMA) at 1.0803. Wednesday’s bullish push dragged the pair back into contention with a descending trendline drawn from 2024’s peak bids near 1.1150, but near-term technical resistance is keeping the Fiber pinned. The pair has etched in a near-term technical rejection from 1.0850, and the way is open for a bearish return to this week’s low bids near 1.0720. EUR/USD hourly chart EUR/USD daily chart EUR/USD Overview Today last price 1.0811 Today Daily Change 0.0071 Today Daily Change % 0.66 Today daily open 1.074   Trends Daily SMA20 1.0843 Daily SMA50 1.0778 Daily SMA100 1.0804 Daily SMA200 1.0788   Levels Previous Daily High 1.0774 Previous Daily Low 1.072 Previous Weekly High 1.0916 Previous Weekly Low 1.08 Previous Monthly High 1.0895 Previous Monthly Low 1.065 Daily Fibonacci 38.2% 1.074 Daily Fibonacci 61.8% 1.0753 Daily Pivot Point S1 1.0715 Daily Pivot Point S2 1.069 Daily Pivot Point S3 1.0661 Daily Pivot Point R1 1.0769 Daily Pivot Point R2 1.0798 Daily Pivot Point R3 1.0823    

Silver prices registered solid gains of 1.45% on Wednesday, as the US Federal Reserve kept monetary policy unchanged while upwardly reviewing its inflation expectations and adjusted its estimates for the federal funds rate.

Silver rises 1.45% as Fed leaves policy unchanged, adjusts inflation outlook, and anticipates one rate cut.XAG/USD shows a double-top pattern indicating potential declines; initial support at $29.00.Resistance at $30.05; surpassing this could target recent highs, though buyers continue to face challenges.Silver prices registered solid gains of 1.45% on Wednesday, as the US Federal Reserve kept monetary policy unchanged while upwardly reviewing its inflation expectations and adjusted its estimates for the federal funds rate. As the US central bank projects one rate cut, the XAG/USD trades at $29.59, down 0.29% as Thursday’s Asian session begins. XAG/USD Price Analysis: Technical Outlook Silver's double-top chart pattern remains in effect, suggesting that the metal's spot prices might decline further. XAG/USD fell below the May 24 low of $30.05, confirming the double-top pattern. The initial support for XAG/USD is at $29.00, followed by the June 7 low of $29.12. Breaking below this level could lead to a drop under $29.00, then to the May 18, 2021, high turned support of $28.74, and subsequently to the June 10, 2021, high of $28.34. The final target is the double top objective at $27.80. Conversely, if XAG/USD moves upwards and closes above $29.00, it could challenge the May 24 low, which has turned into resistance at $30.05. Buyers are struggling to reclaim $30.00, indicating potential for further downside. XAG/USD Price Action – Daily ChartXAG/USD Overview Today last price 29.64 Today Daily Change 0.36 Today Daily Change % 1.23 Today daily open 29.28   Trends Daily SMA20 30.65 Daily SMA50 28.84 Daily SMA100 26.2 Daily SMA200 24.69   Levels Previous Daily High 29.86 Previous Daily Low 29.04 Previous Weekly High 31.55 Previous Weekly Low 29.12 Previous Monthly High 32.51 Previous Monthly Low 26.02 Daily Fibonacci 38.2% 29.35 Daily Fibonacci 61.8% 29.55 Daily Pivot Point S1 28.92 Daily Pivot Point S2 28.56 Daily Pivot Point S3 28.09 Daily Pivot Point R1 29.75 Daily Pivot Point R2 30.22 Daily Pivot Point R3 30.58    

United Kingdom RICS Housing Price Balance below expectations (-6%) in May: Actual (-17%)

New Zealand Electronic Card Retail Sales (MoM) fell from previous -0.4% to -1.1% in May

New Zealand Electronic Card Retail Sales (YoY) up to -1.6% in May from previous -3.8%

United Kingdom RICS Housing Price Balance registered at -1.1% above expectations (-6%) in May

GBP/JPY found a new 16-year high of 200.95 on Wednesday, with Guppy bidders shrugging off a steep miss in UK manufacturing activity as the Yen continues to weaken across the board.

Guppy tips into new 16-year high of 200.95 despite soft UK data.UK Manufacturing Production tumbled in April, contracted more than expected.Yen traders look ahead to Friday’s latest rate call from BoJ.GBP/JPY found a new 16-year high of 200.95 on Wednesday, with Guppy bidders shrugging off a steep miss in UK manufacturing activity as the Yen continues to weaken across the board. UK Manufacturing Production saw its sharpest drawdown since 2021, declining -1.4% MoM in April and completely missing the forecast -0.2% contraction from the previous month’s scant 0.3% growth. GBP traders shrugged off the downside print in UK manufacturing activity to bid the Sterling higher against the Yen, clipping into a 16-year peak before slipping back slightly amidst broad-market flows. Yen markets are pivoting to face the Bank of Japan’s (BoJ) latest rate call and Monetary Policy Statement. The BoJ has left the Yen notoriously unprotected as the Japanese central bank’s hypereasy policy stance leaves the JPY notably weak, with Yen flows floundering as the rate differential between the BoJ and other major global central banks weighs on JPY strength. GBP/JPY technical outlook GBP/JPY continues to pin firmly into bullish territory, trading north of the 200-hour Exponential Moving Average (EMA) at 199.73. The pair’s tilt into new highs on Wednesday leaves the pair overextended with few technical resistance points in the way. However, overbought conditions could see a near-term snap back to consolidation levels near 199.50. GBP/JPY hourly chart GBP/JPY daily chart GBP/JPY Overview Today last price 200.49 Today Daily Change 0.31 Today Daily Change % 0.15 Today daily open 200.18   Trends Daily SMA20 199.19 Daily SMA50 195.7 Daily SMA100 192.59 Daily SMA200 188.1   Levels Previous Daily High 200.4 Previous Daily Low 199.68 Previous Weekly High 200.65 Previous Weekly Low 197.21 Previous Monthly High 200.75 Previous Monthly Low 191.37 Daily Fibonacci 38.2% 200.13 Daily Fibonacci 61.8% 199.96 Daily Pivot Point S1 199.78 Daily Pivot Point S2 199.37 Daily Pivot Point S3 199.06 Daily Pivot Point R1 200.49 Daily Pivot Point R2 200.8 Daily Pivot Point R3 201.21    

The USD/CHF remains in the red, yet off daily lows of 0.8893 after the US Federal Reserve held rates unchanged and tilted hawkish.

USD/CHF trades at 0.8944, recovering from daily lows of 0.8893 following the Fed's hawkish stance.Fed keeps rates at 5.25%-5.50%, revises federal funds rate projection to 5.1% for end of 2024.May’s US inflation data is weaker than April’s, impacting USD as Treasury yields plunge; upcoming PPI and jobless claims data are in focus.The USD/CHF remains in the red, yet off daily lows of 0.8893 after the US Federal Reserve held rates unchanged and tilted hawkish. Policymakers expected just one rate cut instead of the three foresaw in the Summary of Economic Projections (SEP) in March 2024. Therefore, traders booked profits as the major recovered some ground and exchanged hands at 0.8944, down 0.35%. Swiss Franc trims some gains after Fed’s adjust interest rate cut expectations Federal Reserve officials tilted hawkish on their June monetary policy meeting decision via the Summary of Economic Projections (SEP), as they project just one interest rate cut instead of the three foresaw since the December 2023 meeting. They voted unanimously to keep the federal funds rate (FFR) at around 5.25%-5.50% and upward revised their inflation expectations as measured by the Personal Consumption Expenditure (PCE) Price Index. The SEP showed that Fed officials upward revised their projections of the federal funds rate from 4.6% to 5.1% toward the end of 2024. Regarding Gross Domestic Product (GDP) for 2024, they project a 2.1% increase, as foreseen in March, while the Unemployment Rate is projected at 4%, unchanged from March’s SEP. PCE inflation is expected to rise from 2.4% to 2.6%, and Core PCE is expected to rise from 2.6% to 2.8%. Earlier, the US Bureau of Labor Statistics (BLS) revealed that May’s inflation in the US was unchanged, but lower than April’s data. This weakened the Greenback due to plunging US Treasury bond yields. Ahead of the week, the US economic docket will feature May’s Producer Price Index (PPI) and Initial Jobless Claims (IJC) on Thursday. USD/CHF Price Analysis: Technical outlook From a daily chart perspective, the USD/CHF dived and tested the 200-day moving average (DMA) at 0.8896 before recovering from its earlier losses. Although the pair aimed higher, it was capped at the 100-DMA at 0.8949, a strong resistance level. If it’s cleared, the pair could rally toward 0.9000 and beyond. On the downside, the first support would be the 200-DMA at 0.8896. Key support levels lie below, like the 0.8800 figure. USD/CHF Overview Today last price 0.8944 Today Daily Change -0.0032 Today Daily Change % -0.36 Today daily open 0.8976   Trends Daily SMA20 0.9044 Daily SMA50 0.9075 Daily SMA100 0.8945 Daily SMA200 0.8893   Levels Previous Daily High 0.8993 Previous Daily Low 0.8959 Previous Weekly High 0.9036 Previous Weekly Low 0.8881 Previous Monthly High 0.9225 Previous Monthly Low 0.8988 Daily Fibonacci 38.2% 0.898 Daily Fibonacci 61.8% 0.8972 Daily Pivot Point S1 0.8959 Daily Pivot Point S2 0.8942 Daily Pivot Point S3 0.8924 Daily Pivot Point R1 0.8993 Daily Pivot Point R2 0.9011 Daily Pivot Point R3 0.9028    

In Wednesday's session, the AUD/JPY pair exhibited a promising move, surpassing the 20-day Simple Moving Average (SMA) at 103.90.

The AUD/JPY pair surpassed the 20-day SMA, indicating a rising bullish momentum.Despite the rise, the pair is still in a consolidation phase, hinting at the possibility of limited gains.The bull's next target stands at 105.00.In Wednesday's session, the AUD/JPY pair exhibited a promising move, surpassing the 20-day Simple Moving Average (SMA) at 103.90. This could be a positive sign, demonstrating strength in the Australian Dollar against its competitors. However, the ongoing consolidation phase suggests that there may not be enough momentum for a persistent rise. The daily Relative Strength Index (RSI) for the AUD/JPY currently stands at 59 suggesting a significant shift from Tuesday’'s 53. On the other hand, the Moving Average Convergence Divergence (MACD) continues to display decreasing red bars, suggesting a potential weakening in the bearish momentum. AUD/JPY daily chart In conclusion, the AUD/JPY pair seems to be in a consolidation phase, despite successfully rising above the 20-day SMA. The range of 102.00-103.00 may denote the next trading patterns unless the bulls retain control above the 20-day SMA. Nonetheless, the reduction in selling momentum could denote a preparation by the bulls for the next upward swing and might retest the 105.00 area. AUD/JPY Overview Today last price 104.38 Today Daily Change 0.57 Today Daily Change % 0.55 Today daily open 103.81   Trends Daily SMA20 103.94 Daily SMA50 102.14 Daily SMA100 100.01 Daily SMA200 98.07   Levels Previous Daily High 103.95 Previous Daily Low 103.53 Previous Weekly High 104.73 Previous Weekly Low 102.62 Previous Monthly High 104.87 Previous Monthly Low 99.93 Daily Fibonacci 38.2% 103.79 Daily Fibonacci 61.8% 103.69 Daily Pivot Point S1 103.58 Daily Pivot Point S2 103.34 Daily Pivot Point S3 103.16 Daily Pivot Point R1 103.99 Daily Pivot Point R2 104.18 Daily Pivot Point R3 104.41    

Australia is set to release the May employment report on Thursday at 1:30 GMT.

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.fxs-event-module-header{font-size:12.8px;line-height:17px}.fxs-event-module-read-more{display:flex;align-items:center;align-content:center;gap:4px;color:#e4871b;font-size:12.8px;font-family:Roboto;font-style:normal;font-weight:700;line-height:17px;text-decoration:none}.fxs-event-module-read-more svg{width:16px;height:16px}.fxs-event-module-read-more:hover span{text-decoration:underline}.fxs-event-module-release{margin:0;display:flex;flex-direction:column;gap:2px}.fxs-event-module-release>p{font-size:12.8px;font-family:Roboto;font-style:normal;line-height:17px;margin:0}.fxs-event-module-release>p>strong{color:#8c8d91;font-weight:700}.fxs-event-module-release>p>span{color:#8c8d91;font-weight:400}.fxs-event-module-release>p>a{color:#e4871b;font-weight:700;text-decoration:none}.fxs-event-module-release>p>a:hover>span{text-decoration:underline}.fxs-event-module-inner-calendar .fxs-event-module-container{margin:16px 0 0 0;border-top:1px solid #ececf1;padding:12px 0 0 0}@media (min-width:680px){.fxs-event-module-inner-calendar .fxs-event-module-header{font-size:14.72px;line-height:20px}.fxs-event-module-release p{font-size:14.72px;line-height:20px}.fxs-event-module-read-more{font-size:14.72px;line-height:20px}.fxs-event-module-calendar-title{font-size:22.4px;line-height:25.6px}.fxs-event-module-title{font-size:19.2px;line-height:27.2px}.fxs-event-module-header{font-size:19.2px;line-height:25.92px}.fxs-event-module-content{font-size:16px;line-height:21.6px}}The Australian Unemployment Rate is foreseen to contract to 4% in May.Employment Change expected to remain tepid, up by 27.5K in the month.AUD/USD set to run to fresh multi-month highs with an upbeat report.Australia is set to release the May employment report on Thursday at 1:30 GMT. The Australian Bureau of Statistics (ABS) is expected to announce the country added 27.5K new job positions in the month, down from the 38.5K gained in April. The Unemployment Rate is foreseen at 4%, easing from the previous 4.1%. Ahead of the announcement, the Australian Dollar (AUD) is up amid broad US Dollar’s weakness.  Headline Employment Change is split into full-time and part-time positions. Generally speaking, full-time jobs imply working 38 hours per week or more and usually include additional benefits, but they mostly represent consistent income. On the other hand, part-time employment generally means higher hourly rates but lacks consistency and benefits. That’s why the economy prefers full-time jobs. According to the April report, seasonally adjusted, the number of people counted as officially unemployed increased by 30,300 in the month, while the number of employed people increased by 38,500. The latter combines an increase of 44,600 part-time positions and a loss of 6,100 full-time jobs.  Australian unemployment rate expected to ease in May Market analysts anticipate the Australian Unemployment Rate will ease from the 4.1% posted in April to 4%. April’s level was the highest since March 2022, and was also hit in January this year.  The decline in full-time employment and the uptick in the unemployment rate in April was seen as a tepid sign of a loosening labor market. Speculative interest would welcome another monthly report in such a line as it could lift the odds for an interest rate cut in the country before the year's end. The Reserve Bank of Australia (RBA) met early in May, and policymakers decided to leave the benchmark rate at 4.35%. The RBA also warned about inflation risks being on the upside but refrained from reinstating the tightening bias dropped in the previous meeting. Policymakers also noted that inflation is easing more slowly than previously expected. “The economic outlook remains uncertain, and recent data have demonstrated that the process of returning inflation to target is unlikely to be smooth,” said the Board’s statement.  Ahead of the employment report, market players believe the RBA could deliver a rate cut in November and four more throughout 2025. However, sticky inflation and a tight labor market may push the odds further down the road. According to the ABS, the Consumer Price Index rose by 3.6% in the twelve months to April, up from the previous 3.5%. It was the second consecutive month in which inflation posted a small increase, in line with policymakers’ concerns.  With that in mind, a better-than-anticipated employment report would fuel speculation the RBA will not cut rates until February 2025 and boost the Australian Dollar.  Ahead of Australian employment figures, the focus was on the United States (US). The Bureau of Labor Statistics (BLS) reported that the  Consumer Price Index (CPI) rose 3.3% YoY in May after hitting 3.4% in April. The CPI remained unchanged on a monthly basis, easing from the previous 0.3%. The core readings, which exclude volatile food and energy prices, were also below forecast and eased from the April readings. The annual core CPI rose 3.4%, while the monthly figure was up by 0.2%.  The softer-than-anticipated US inflation figures triggered a US Dollar sell-off, prompting AUD/USD higher. When will the Australian employment report be released, and how could it affect AUD/USD? The ABS will publish the May employment report early on Thursday. As previously stated, Australia is expected to have added 27.5K new job positions in the month, while the Unemployment Rate is foreseen at 4%. Finally, the Participation Rate is foreseen to hold at 66.7%. From a technical perspective, Valeria Bednarik, Chief Analyst at FXStreet, notes: “The AUD/USD pair nears a relevant high posted mid-May at 0.6713 as optimism reigns. Beyond the 0.6700 mark, the pair can run towards the 0.6700 region with an upbeat Australian employment report, although given the pre-news rally, additional advances without a pullback in the middle seem unlikely. Near-term support can be found at around 0.6630, followed by the 0.6580 price zone.”  Bednarik adds: “Ultimately, AUD/USD direction will depend on how the data would affect the odds for a rate cut in Australia. It is worth remembering that the Australian interest rate peaked below those of its major counterparts, making it less worrisome should local policymakers decide to delay the decision.” Employment FAQs How do employment levels affect currencies? Labor market conditions are a key element in assessing the health of an economy and thus a key driver for currency valuation. High employment, or low unemployment, has positive implications for consumer spending and economic growth, boosting the value of the local currency. Moreover, a very tight labor market – a situation in which there is a shortage of workers to fill open positions – can also have implications on inflation levels because low labor supply and high demand leads to higher wages. Why is wage growth important? The pace at which salaries are growing in an economy is key for policymakers. High wage growth means that households have more money to spend, usually leading to price increases in consumer goods. In contrast to more volatile sources of inflation such as energy prices, wage growth is seen as a key component of underlying and persisting inflation as salary increases are unlikely to be undone. Central banks around the world pay close attention to wage growth data when deciding on monetary policy. How much do central banks care about employment? The weight that each central bank assigns to labor market conditions depends on its objectives. Some central banks explicitly have mandates related to the labor market beyond controlling inflation levels. The US Federal Reserve (Fed), for example, has the dual mandate of promoting maximum employment and stable prices. Meanwhile, the European Central Bank’s (ECB) sole mandate is to keep inflation under control. Still, and despite whatever mandates they have, labor market conditions are an important factor for policymakers given their significance as a gauge of the health of the economy and their direct relationship to inflation. Economic Indicator Unemployment Rate s.a. The Unemployment Rate, released by the Australian Bureau of Statistics, is the number of unemployed workers divided by the total civilian labor force, expressed as a percentage. If the rate increases, it indicates a lack of expansion within the Australian labor market and a weakness within the Australian economy. A decrease in the figure is seen as bullish for the Australian Dollar (AUD), while an increase is seen as bearish. Read more. Last release: Thu May 16, 2024 01:30 Frequency: MonthlyActual: 4.1%Consensus: 3.9%Previous: 3.8%Source: Australian Bureau of Statistics Why it matters to traders? The Australian Bureau of Statistics (ABS) publishes an overview of trends in the Australian labour market, with unemployment rate a closely watched indicator. It is released about 15 days after the month end and throws light on the overall economic conditions, as it is highly correlated to consumer spending and inflation. Despite the lagging nature of the indicator, it affects the Reserve Bank of Australia’s (RBA) interest rate decisions, in turn, moving the Australian dollar. Upbeat figure tends to be AUD positive.  
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