News

U.S. Dollar Strengthens as China Halts Trade Talks

USD

The dollar index which measures the greenback against a basket of major currencies bounced-off a ten-week low of 93.81 on Friday, supported by a weaker pound, and continued stronger to reach a high of 94.37 during today's Asian session as China halted trade talks for the week. The fears of not reaching a Brexit deal sent the pound lower to log its biggest losing day in a year which increased the demand for the dollar. Moreover, during the past months, the dollar gained support from the mounting trade friction between China and the United States as investors rushed to the safe haven assets. On the other hand, the Federal Reserve will end a two-day policy meeting on Wednesday where market participants expect the Fed to raise rates by 25 basis points. The US 10-year treasury yields reached a four-month high of 3.097 last week.

Metals

Gold prices drifted lower as the U.S. dollar surged and Treasury yields hovered near a four-month high ahead of an anticipated rate hike. The bullion retreated from a three-week high of $1211 to trade at a two-week low of $1191. The gold ounce is still trading in a tight range between a support zone of $1188 and a resistance zone of $1214. On the other hand, the silver ounce fell from a two-week high of $14.43 to settle lower at $14.28.

Oil

Oil prices opened higher, as the meeting between OPEC and non-OPEC energy ministers ended with no formal recommendation for any additional supply boost. The West Texas Intermediate crude futures traded at a ten-week high of $72.13 per barrel, and the Brent futures rose to a high of $80.44 per barrel, slightly short from posting the highest price since late 2014. President Trump urged OPEC to drive the oil prices down as higher gasoline price could create a political headache for Republicans ahead of the mid-term elections.

Major Economic Events

GMT Country Event Expectation Previous
8:00 EU German Ifo Business Climate Index 103.2 103.8
8:30 UK BoE Financial Stability Report    
13:00 EU ECB President Draghi Speaks    


Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM.COM. 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.

CFDs and Spot FX are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.80% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs and Spot FX work, and whether you can afford to take the high risk of losing your money. Read More
Read More
Mail Call Chat