On Tuesday, the Greenback hit a one-week high vs. a basket of six major currencies, as focus shifted to the possibility of a December Federal Reserve rate rise. The U.S. dollar index settled above 95.55 pips at the end of yesterday’s trading session.
Eurozone employment rate grew at a steady pace and touched new highs in the second quarter, a positive sign for future economic growth; but the number of people employed across the Eurozone was still low. Despite such data, Euro declined to $1.12 yesterday. Technically, fiber could trade sideways at $1.12 during the course of the week, in anticipation of the Fed meeting report, which will be released this month.
GBP fell as much as 1% and declined to its lowest level in two weeks, after the UK inflation report missed forecasts. Cable fell on a weak U.K. inflation report and traded below $1.32 vs. USD. From a technical point of view, the pair could decline further during the next period.
Gold prices declined on Tuesday amid uncertainty about whether the Fed will hike interest rates next week. On the other hand, traders trimmed their expectations that the Federal Reserve could hike interest rates in September to 15% from 24% on Friday.
On Tuesday, Oil prices fell by 3% as traders suggested the global overhang of unused inventories might persist for longer than anticipated. U.S. crude declined to $45 and could settle at such level.
The most important economic events:
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM Capital Limited. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.