PMI reading and BoC policy take center stage today. The US dollar was broadly higher in quiet trading as investors digested US President Joe Biden’s decision to end his re-election campaign, which could add volatility to currency markets. However, the dollar weakened against the yen after two consecutive days of gains.
Market participants also looked forward to next week’s key monetary policy meetings between the central bank and the Bank of Japan. The Fed could signal that it is ready to start an easing cycle at its next meeting in September, while the BOJ, on the other hand, could start to raise interest rates, giving the yen a bit of a boost.
June US existing home sales fell -5.4% to 3.89 million, weaker than market expectations for a -3.2% drop to 3.98 million. Home sales continue to be undercut by high mortgage rates and high home prices.
The July Richmond Fed manufacturing index fell by -7 points to -17, weaker than expectations for a +3-point rise to -7. The July Richmond Fed business conditions index fell by -1 point to -8, although June was revised higher by 3 points to -8 from -11.
Gold and Silver prices drop drastically yesterday after Finance Minister Nirmala Sitharaman announced a reduction in customs duties on gold and silver to 6%. The customs duty on platinum was reduced to 6.4% as well.
Crude oil prices fell about 2% to a six-week low on Tuesday on rising expectations of a ceasefire in Gaza and growing concerns about demand in China. In the Middle East, efforts to reach a ceasefire deal between Israel and militant group Hamas under a plan outlined by U.S. President Joe Biden in May and mediated by Egypt and Qatar, have gained momentum over the past month.
Israeli Prime Minister Benjamin Netanyahu told families of hostages held in Gaza that a deal to secure their release could be near even as fighting raged in the Palestinian enclave.
Copper prices slid to trade near a three-and-a-half-month low hit in the previous session, as concerns about demand in top consumer China weighed on the market.
MCX gold futures settled -5.79% to 68510.Silver settled -4.80% to 84919. Copper settled -0.86% to 807. Crude oil -1.55% at 6458. Natural gas -2.44% to 183.60.
Economic data and events scheduled today (PMI Reading & BoC Policy)
Eurozone
At 11.30am- German GfK Consumer Climate. Data is foreseen at -21.1 from previous -21.8.
At 12.45pm-
French Flash Manufacturing PMI. Data is foreseen at 45.8 from previous 45.4.
French Flash Services PMI. Data is foreseen at 49.7 from previous 49.6
At 1.00pm-
German Flash Manufacturing PMI. Data is foreseen at 44.1 from previous 43.5.
German Flash Services PMI. Data is foreseen at 53.2 from previous 53.1.
At 1.30pm-
Flash Manufacturing PMI. Data is foreseen at 46.00 from previous 45.8.
Flash Services PMI. Data is foreseen at 52.9 from previous 52.8.
Above data could have a volatile impact on the Euro.
UK
At 2.00pm-
Flash Manufacturing PMI. Data is foreseen at 51.1 from previous 50.9.
Flash Services PMI. Data is foreseen at 52.5 from previous 52.1.
Above data could have a volatile impact on the pound.
Canada
At 7.15pm-
BOC Monetary Policy Report. BOC Rate Statement.
Overnight Rate. Expect to cut rate by 4.50% from 4.75%.
At 8.00pm- BOC Press Conference.
Above data could have a volatile impact on the dollar.
US
At 6.00pm-
Goods Trade Balance. Data is foreseen at -98.9B from previous -99.4B.
Prelim Wholesale Inventories m/m. Data is foreseen at 0.4% from previous 0.6%.
At 7.15pm-
Flash Manufacturing PMI. Data is foreseen at 51.6 from previous 51.6.
Flash Services PMI. Data is foreseen at 54.7 from previous 55.3.
At 7.30pm- New Home Sales. Data is foreseen at 639k from previous 619k.
At 8.00pm- Crude Oil Inventories.
Above data could have a volatile on the dollar.
Happy Trading!
Commodity Samachar
Learn and Trade with Ease
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