Currency Majors Are Being Traded Steadily. Investors Assess Important Economic Releases

The US dollar is consolidating against a basket of major currencies. Investors took statements by Fed Chairman, Jerome Powell, on Wednesday as a signal for a further sharp fall in the key interest rate. However, a positive report on US inflation was published yesterday. Thus, according to the report, inflation accelerated by 0.3% (m/m) in June, while experts expected an increase by 0.2% (m/m). Also, the number of initial jobless claims dropped to 209K instead of 220K. Optimistic data that indicated a good state of the labor market weakened financial market expectations for a more aggressive rate cut by 50 basis points at the Fed meeting on July 30-31.

The European Commission has lowered the 2020 Eurozone GDP growth forecast to 1.4% from 1.5%. For 2019, the economic recovery estimate remains unchanged at 1.2%. The EC also lowered its growth forecast in the EU economy next year. The estimate of GDP growth in 27 countries for 2020 has been revised to 1.6% from 1.7%. According to the forecast, consumer prices in the Eurozone will increase by 1.3% in 2019-2020 against the forecasted 1.4%. The European Commission believes that duties imposed by the United States and China, may adversely affect the entire global economy. The slowdown in economic growth in the next two years may turn out to be even more significant if the United States and China continue to increase duties on each other’s goods. According to the minutes of the last meeting of the ECB, the regulator does not exclude the introduction of additional stimulus measures amid growing risks in the global economy.

The "black gold" prices continue to rise. At the moment, futures for the WTI crude oil are testing the mark of $60.70 per barrel.

Market Indicators

Yesterday, there was a variety of trends in the US stock markets: #SPY (+0.23%), #DIA (+0.83%), #QQQ (-0.07%).

The 10-year US government bonds yield has been growing. At the moment, the indicator is at the level of 2.10-2.11%.

- Producer price index in the US at 15:30 (GMT+3:00).

by JMarkets, 2019.07.12

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.