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Financial markets experienced volatility on Wednesday, with strong price increases in currencies and metals. US stocks fluctuated between gains and losses, and although the US Dollar somewhat increased, it fell during the American session.
Economic Data
Fed’s Beige Book states that “economic activity was hardly changed in recent weeks. The weekly Jobless Claims, the Philly Fed, and Existing Home Sales are among the US data that are due on Thursday.
Key Developments
The EUR/USD fell around 1.0900 before bouncing back to challenge important near-term resistance at 1.0980. Although the trend is upward, the pair is currently consolidating while waiting for the next catalysts. The European Central Bank’s most recent meeting’s minutes will be made public on Thursday.
The US Dollar Index rose 0.25 percent and finished close to 102.000. As market players anticipate additional rate increases from the Federal Reserve (Fed), the European Central Bank (ECB), and the Bank of England (BoE) in May, it has continued to drift sideways. On Thursday, China is anticipated to maintain its benchmark lending rate at 3.65%.
The USD/JPY reached a high of 145 and then lost ground. However, it is still rising upward and above important daily moving averages as it moves alongside US yields. Japan will publish trade figures on Thursday.
NZD/USD remains stable at 0.6200, with the 200-day SMA providing support and 0.6240, the intersection of the 20 and 55 SMAs, serving as resistance. Data on New Zealand’s Q1 inflation are due on Thursday and will be important in determining what the Reserve Bank of New Zealand (RBNZ) is expected to do.
Following inflation data from the UK, the Pound gained on Wednesday, raising hopes for another rate hike from the Bank of England in May and maybe in June. The March Consumer Price Index was 10.1% YoY, higher than the market forecast of 9.8%, while wholesale inflation again came in above expectations. As a result, GBP/USD surged to 1.2473 before falling to levels below 1.2400 and closing the day just slightly higher at 1.2440.
The Canadian dollar declined on Wednesday after strengthening on Tuesday as a result of Canadian CPI data. USD/CAD resumed its upward trend, moving beyond 1.3450 to reach new weekly highs. In his Wednesday parliamentary hearing, Governor Macklem of the Bank of Canada (BoC) said nothing new; he will speak again on Thursday.
Trading at around 0.6700, AUD/USD maintained its sideways movement. Governor Lowe of the Reserve Bank of Australia (RBA) will attend a press conference to discuss a review of the structure of the central bank; he is not anticipated to discuss the forecast for monetary policy.
Gold bottomed out at $1,967 before bouncing back to $1,995 amid a decline in the value of the Dollar. It concluded lower but still far from the daily low. From the bottom, silver increased by more than 2.5%, regaining $25.00. Bitcoin lost all of its gains from Tuesday and fell more than 3% to $29,300.
What To Watch For Next Sessions
New Zealand will release data on Q1 consumer inflation on Thursday. The standard lending rates in China are not anticipated to alter. Released by the National Australia Bank, the Business Confidence poll is anticipated to rebound into positive territory in the first quarter. Japan’s trade data is forthcoming. The independent assessment of the central bank will be delivered by RBA Governor Lowe.
Also Read:
GBP/USD bears are moving ahead eying 1.2350
USD/JPY bulls advance towards 135
Recent data indicates BoE’s 25 bps hike in May
Gold’s bears advance to test a crucial support
Fed’s Beige Book: Stress on US economy eased after SVB crisis
USD/CAD expected to surge on stronger USD
