News

Dollar, Yields Uptick ahead of Data

USD

The dollar index, which measures the greenback against a basket of major currencies, edged higher during the Asian session to 96.39 as investors await key economic data. The final reading of the first quarter GDP figures will be published today with the main focus being on the GDP price index. Earlier this week, DXY bounced off a three-month low following the comments of Fed officials which checked the aggressive easing prospects. The Federal Reserve Chairman Jerome Powell affirmed the strong US economic outlook despite inflation running slightly lower than the target, and that the Fed will closely monitor the economic data and developments before acting. On the other hand, investors are looking forward to the G20 summit where President Donald Trump will be meeting the Chinese President Xi Jinping to talk trade. The US 10-year yields continued the swing higher to 2.069%, the USDJPY surged to 108.15, and the EURUSD dipped to $1.1348.

Metals

During the Asian session, precious metals prices drifted lower as the dollar inched higher along with Treasury yields. The price of a gold ounce tumbled to a low of $1403, to remain slightly positive on the week, the price of a silver ounce dropped to $15.16, while palladium hovered around $1520.

Oil

Oil prices edged higher as US crude inventories fall. The US Energy Information Administration reported that the weekly US crude oil inventories declined by 12.788 million barrels last week, the largest drop since September 2016. On the other hand, the increased chances of an extension to the OPEC+ supply-cut deal next week are supporting prices. The West Texas Intermediate crude futures rose to a one-month high of 59.90, and Brent futures edged higher to the 100-day exponential moving average at $66.83.

Major Economic Events

GMT Country Event Expectation Previous

12:00

EU

German CPI (MoM) (Jun)

0.2%

0.2%

12:30

US

GDP (QoQ) (Q1)

3.1%

3.1%

12:30

US

GDP Price Index (QoQ) (Q1)

0.8%

0.5%

14:00

US

Pending Home Sales (MoM) (May)

1.1%

-1.5%


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