The US Dollar Is Consolidating. Trade Talks Between Washington and Beijing Are Still in the Spotlight

The US dollar did not changed a lot against the basket of major currencies during yesterday's trading. The dollar index (#DX) closed with a slight increase (+0.02%). Due to the escalation of the trade conflict between the US and China, the demand for safe assets has increased. Therefore, the Japanese yen has reached six-week highs against the US currency. On Thursday-Friday, talks will be held in Washington, during which Vice Premier Liu He will try to save the agreement.

The euro was under pressure after the European Commission lowered the growth rates of the Eurozone economy for the current and next years. The EC has worsened its estimate for the Eurozone's GDP growth for 2019 to 1.2% from the expected 1.3% in February. The growth forecast for the region's economy in 2020 has been lowered to 1.5% from 1.6%.

The UK will take part in the elections to the European Parliament, as it hasn't exit the EU. Elections will be held on May 23. At the same time, the Conservative Party is dissatisfied with the negotiations with the Labour Party. Negotiations between the two parties have been going on for several weeks, so far neither side has taken and has not supported any decisions on Brexit. Members of the Conservative Party, who stand for Brexit, are ready to consider the urgent resignation of T. May.

Today, during the Asian trading session, the RBNZ has decided on the interest rate. As expected, the regulator lowered the key interest rate by 25 basis points to 1.50%. The Central Bank does not exclude a further reduction in interest rates in the future.

The "black gold" prices have recovered most of the losses after a decline the previous day. At the moment, futures for the WTI crude oil are testing the mark of $61.80 per barrel. At 17:30 (GMT+3:00), a report on crude oil inventories will be published in the US.

Market Indicators

Yesterday, the aggressive sales were observed in the US stock market: #SPY (-1.67%), #DIA (-1.80%), #QQQ (-1.95%).

The 10-year US government bonds yield is declining. At the moment, the indicator is at the level of 2.46-2.47%.

- Publication of the ECB account monetary policy meeting at 14:30 (GMT+3:00).

by JMarkets, 2019.05.08

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.