On Thursday, the Greenback inched down to three-year low vs. a basket of major currencies, a day after the Trump administration mentioned that it preferred a weaker currency. The U.S. dollar traded lower after U.S. Treasury secretary Steven Mnuchin told the World Economic Forum in Davos yesterday that a “weaker dollar is good for trade.” On the release front, traders are awaiting the U.S. advance goods trade balance for December, which is expected to hit -$68.6b from -$69.7b.
The single currency rose by 0.14%, to settle at 1.2426 the highest level since December 2014, strongly supported by a weaker US dollar. On the release front, traders are awaiting the European Central Bank Rate Decision later in the day, which is expected to keep interest rates unchanged. Additionally, market players are also awaiting ECB President Draghi holds press conference.
The sterling pound rose by 0.19%, to settle at $1.4267, supported by Wednesday’s upbeat UK employment data.
Against the JPY, the USD fell by 0.15%, to settle at ¥109.06. on the release front, traders are awaiting Japan National Consumer Price Index, which is expected to hit 1.1% from 0.6%.
Gold prices touched their highest since August 2016, as the Greenback hit three-year lows after the U.S. Treasury secretary Steven Mnuchin said that the U.S. administration was not concerned about the level of the dollar in the short term. Gold Futures - Feb 18 (GCG8), rose by 0.24%, to settle at $ 1,359.50.
Early on Thursday, Brent oil prices settled above $71 for the first time since 2014 as the Greenback continued to weaken and crude inventories in the United States declined for a 10th consecutive week, due to ongoing supply cutbacks by OPEC and non-OPEC producers led by Russia. Crude Oil WTI Futures - Feb 18 (CLG8) rose as much as 0.59%, to settle at $66.00and Brent Oil Futures - Mar 18 (LCOH8) was up by 0.40% at $70.81.
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.