Currency Majors Are Consolidating. The Fed Meeting Is in the Focus of Attention

The US dollar does not change a lot against a basket of major currencies. The US dollar index (#DX) closed with a slight increase (+0.02%). Financial market participants expect the Fed to decide on the interest rate. Experts forecast that the regulator should reduce the range of the key interest rate for the first time since 2008. After the announcement of the decision, Fed Chairman, Jerome Powell, will hold a press conference. Investors will closely monitor the official’s speech and look for signals regarding the future rate of monetary policy this year.

The US currency was under pressure due to the statements about the negotiations with China by US President, Donald Trump. As the President said, China delayed trade talks once again, which should have already begun. Trump believes that Beijing waits for the 2020 US presidential elections to make a deal with the new president and continue to "ripoff" the United States.

The British pound is still under pressure. The new British Prime Minister, Boris Johnson, repeated that he would not make a deal with the EU until the condition of the backstop (a process that will help to avoid the resumption of customs control and unhindered trade on the border between Northern Ireland and the Republic of Ireland) would be excluded from it. EU officials said they did not intend to resume negotiations on the Brexit deal.

Today, during the Asian trading session, optimistic data from China have been published. Thus, manufacturing PMI counted to 49.7 in July and was better than the forecasted value of 49.6. Also, the consumer price index (q/q) was published in Australia, which increased by 0.6% in the second quarter instead of 0.5%.

The bullish sentiment continues to prevail in the “black gold” market. At the moment, futures for the WTI crude oil are testing the mark of $58.25 per barrel. At 17:30 (GMT+3:00), crude oil inventories will be published in the US.

Market Indicators

Yesterday, the bearish sentiment was observed in the US stock markets: #SPY (-0.25%), #DIA (-0.08%), #QQQ (-0.43%).

The 10-year US government bonds yield is 2.05-2.06%.

- Statistics on the labor market in Germany at 10:55 (GMT+3:00);
- Consumer price index in the Eurozone at 12:00 (GMT+3:00);
- Data on Eurozone GDP at 12:00 (GMT+3:00);
- ADP nonfarm employment change in the US at 15:15 (GMT+3:00);
- Report on Canada GDP at 15:30 (GMT+3:00);
- Fed interest rate decision at 21:00 (GMT+3:00).

by JMarkets, 2019.07.31

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.