The US consumer index fell unexpectedly in May to its lowest level in six months. US dollar index declined to 92.6 points, the lowest level since November, from an upwardly revised 94.7 in April. Despite this decline, the greenback managed to settle above 95.80 levels.
Gold rose during yesterday's trading session, recovering from its lowest level in three-and-a-half month. The precious metal was negatively affected by strong USD and the expectations of interest rate hikes. Gold traded at $1,217 and could pare its losses to $1,221. The yellow metal is awaiting U.S. private sector jobs, as it could be an indicator to the U.S. Non-farm Payrolls. It is very important for investors to watch this closely as gold could be affected by such a release.
EUR slightly recovered vs. USD as Eurozone deflation eases in May and German unemployment is down as well, despite that, Euro failed to maintain gains. It is worth noting that, fiber could be traded in a limited range as the pair is awaiting ECB’s key policy tomorrow.
The pound declined sharply vs. USD affected by the “Brexit” Campaign. A Guardian poll found “Brexit” leading by 45% to 42% with 13% saying they did not know what they would decide. Cable was negatively affected by such polls, and traded below $1.45. It could decline further during the course of the day. While trading remains subject to the results of opinion polls around $1.45.
US dollar pared its gains vs. Japanese Yen, as U.S. Consumer Confidence Declined in May. USD/JPY traded around 110.50 levels on Tuesday and could decline to 110 levels during the course of the day.
Oil prices were down as Canada’s output returns; WTI traded below $49 and could decline further to $48.50. All eyes are on OPEC’s meeting this week, which is likely to disappoint the expectations of investors and push oil to decline further.
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.