News

Greenback Extends Losses as Data Suggest Lower Interest Rates

USD

The dollar index which measures the greenback against a basket of major currencies settled lower for the second consecutive day on weaker price data. DXY traded at a one-week low of 97.75. The softer GDP Price Index reading triggered selling pressure and continued following the release of the PCE Price Index which is considered as the Fed's favorite inflation gauge. The Core PCE Price Index YoY came in at 1.6%, the lowest reading in a year, missing the expectation of 1.7%. The drop in inflation numbers boosted the probability for lower interest rates before year-end. The Federal Open Market Committee kicks off a two-day monetary policy meeting today. The US 10-year Treasury yields slipped to 2.501%, the USDJPY tumbled to 111.27, and the EURUSD climbed to a one-week high of $1.1194.

Metals

Gold prices edged higher following soft US economic data. The drawdown in inflation figures boosted the demand for the precious metal due to the suggestions that the Fed could be forced to ease the monetary policy if inflation dropped further. The price of gold ounce bounced off a low of $1278 to trade higher at $1284. Meanwhile, silver dipped below $15 again to erase Friday's gains, and Palladium crashed to $1370 losing more than 6%.

Oil

Oil prices recovered slightly from Friday's heavy losses as the U.S. proceeds to end Iran's oil wavers. The Trump administration restated that Saudi and other allies will cover the lost supply. However, Saudi Energy Minister announced that the OPEC+ cut deal could be extended till year end. The West Texas Intermediate crude future rose to a high of $63.68, and Brent futures hovered near $72. Market participants await the release of the weekly US crude oil stock by the American Petroleum Institute.

Major Economic Events

GMT Country Event Expectation Previous

9:00

EU

GDP (QoQ) 

0.3%

0.2%

12:00

EU

German CPI (MoM) (Apr) 

0.5%

0.4%

12:30

CA

GDP (YoY)

1.4%

1.6%

13:45

US

Chicago PMI (Apr)

59.1

58.7

12:30

US

CB Consumer Confidence (Apr)

126

124.1

17:00

US

Pending Home Sales (MoM) (Mar)

1.1%

-1.0%

20:30

US

API Weekly Crude Oil Stock

 

6.900

 

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