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Risk aversion has been leading most assets amid the war fogs and indecisive peace talks in Eastern Europe.
Economic Data
Earlier on Thursday, the headline ISM Services PMI reading slid to 56.5 in February from 59.9 in January, below the expected rise to 61.0, according to the latest release by the Institute for Supply Management.
Other Developments
Wall Street opened with substantial gains but quickly turned red amid concerns related not only to the war but also to an aggressive US Federal Reserve.
In his second day before Congress, chief Jerome Powell said that policymakers are prepared to raise rates by more than 25 bps in upcoming meetings, further denting demand for high-yielding assets.
The Russian stocks’ market remains closed, but shares of EU companies with a Russian exposure plunged. Russia is at the brink of default because of global sanctions. Attacks against Ukraine continued, and Russian President Vladimir Putin told his French counterpart Emmanuel Macron that the goals of Russia’s operation in Ukraine would be achieved in any case.
The market sentiment improved, and stocks bounced, putting a halt to the dollar’s rally, on news coming from Ukraine.
Kyiv said it reached a tentative agreement with Russia to organize safe corridors to evacuate civilians.
Under the agreement, a ceasefire would be observed where safe corridors are created. Also, the third round of talks has been announced for next week.
Bank of Canada Governor Tiff Macklem noted that he would not rule out a 50-basis-point increase in the future, as there is plenty of room to boost interest rates this year.
The EUR/USD pair plummeted to 1.1032, its lowest since May 2020, amid demand for safety. The pair hovers around 1.1060 while heading into the daily close. GBP/USD trades in the 1.3350 area.
The Australian dollar was among the best performers, as AUD/USD hit a fresh 2022 high of 0.7347, holding nearby ahead of the Asian opening.
The USD/CAD pair edged higher and settled at around 1.2675, as crude oil prices finally gave up a bit.
Gold Prices edged marginally higher. Spot gold trades at around USD 1,933.00 a troy ounce, having spent the day within Wednesday’s range. WTI peaked at USD 116.51 per barrel but currently trades at around USD 109. US oil price retreated by 3% as WTI crude fell off decade highs on Thursday following reports that a deal to allow the return of Iranian supplies to the global market is near.
Friday’s NFP Data In Focus
The US jobs data will be under the microscope in this regard. On Friday, the Nonfarm Payrolls will be key. Earlier Thursday, data showed the number of Americans filing new claims for unemployment benefits dropped to their lowest level this year last week. For Friday’s data, analysts are anticipating another month of solid job growth.
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