The economic news for today looks quite interesting.
The US dollar strengthened against major currencies, supported by housing comments from Federal Reserve officials and data showing a stable housing market in the world’s largest economic. Both suggest that the central bank is in no rush to start its rate-cutting cycle.
Federal Reserve Governor Michelle Bowman boosted the dollar by reiterating her view on Tuesday that holding the key interest rate steady “for some time” will likely be enough to keep inflation under control. He also reiterated his readiness to raise borrowing costs if necessary.
Federal Reserve Governor Lisa Cook, meanwhile, said it would be appropriate to cut interest rates “at some point” because inflation has made significant progress and the labor market is gradually cooling. However, he remained unclear on the timing of the easing.
The greenback firmed against the euro, yen, Swiss franc, and commodity currencies, such as the Australian and New Zealand dollars.
Further, U.S. data was mixed, which supported the dollar gains.
A report showed U.S. single-family home prices increased at a steady pace in April, rising 0.2% on the month after being unchanged in March. In the 12 months through April house prices increased 6.3% after advancing 6.7% in March. That pushed the dollar a little higher.
U.S. consumer confidence, however, slightly eased in June, with the index at 100.4 from a downwardly revised 101.3 in May, according to the Conference Board. The June number, however, was marginally higher than the market forecast of 100. The report didn’t really hurt the dollar.
Gold prices slipped after an uptick in the dollar and Treasury yields as investors awaited U.S. inflation data due later this week that could provide cues on the timing of interest rate cuts by the Federal Reserve this year.
Copper retreated from the day’s high, pressured by subdued demand in top consumer China and a significant upturn in deliveries to warehouses approved by the London Metal Exchange (LME) while some support was provided by a softer dollar.
Crude traded down as stronger dollar is weighing on crude prices. Losses in crude are limited and gasoline rose on carryover support from last Thursday’s weekly EIA report that showed US gasoline demand rose to a 7-month high.
MCX gold futures settled -0.45% to 71467.Silver settled -2.32% to 86937.Copper settled -0.10% to 842.20. Crude oil -0.75% at 6771. Natural gas +0.04% to 230.7.
Economic data and events scheduled today
Australia
At 7.00am- CPI y/y. Data is foreseen at 3.8% from previous 3.6%.
Above data could have a volatile impact on the dollar.
Eurozone
At 11.30am – German GfK Consumer Climate. Data is foreseen at -19.4 from previous -20.9.
Above data could have a neutral impact on the Euro.
U.K.
At 3.30pm- CBI Realized Sales. Data is foreseen at 1.00. Previous was at 8.00.
Above data could have a mixed impact on the pound.
US
At 7.30pm- New Home Sales. Data is foreseen at 636K from previous 634K.
At 8.00pm- Crude Oil Inventories. Previous was at -2.5m.
Above data could have a volatile on the dollar.
Happy Trading!
Commodity Samachar
Learn and Trade with Ease
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