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Uncertainty is prevalent regarding the Fed’s intentions that will unfold after FOMC meeting, later in December. Fed officials hinted at an easing pace of quantitative tightening starting as soon as this month, despite signs of easing inflation, but doubts are increasing lest the economy should fall in long-lasting recession.
ECB’s Constantinos Herodotou said the central bank would hike rates again but warned they are near the neutral rate.
Crude oil prices were sharply down, with the barrel of WTI currently changing hands at $74 per barrel. The USD/CAD pair surged towards the 1.3660 price zone, where it currently trades.
Key Developments
Tensions between Europe and Russia escalate, as the latter is considering reducing oil production while setting a floor for oil sales in response to the G-7 decision to cap prices.
Risk aversion accompanied most of the trading time during the US session across financial markets. This has helped the US Dollar’s advance on Tuesday. The dollar lost some ground throughout the first half of the day, but found momentum after Wall Street’s opening as US indexes fell for the fourth session.
The dollar finished the day with gains, particularly against its high-yielding rivals. The EUR/USD pair hovers around 1.460, while GBP/USD trades in the 1.2140 price territory.
Australia will publish its Q3 Gross Domestic Product early on Wednesday, and the economy is expected to have grown at an annualized pace of 6.3%.
Mathew McDermott, Goldman Sachs’ head of digital assets, suggested on Tuesday that the bank ponders to invest in, or even buy crypto firms whose prices significantly deteriorated in the wake of the FTX collapse in deals that would cost tens of millions of dollars.
Economic Data
US October Goods and Services Trade Balance edged up to record -$78.2 billion in October. The US dollar Index stays in negative territory at around 105.00. This reading came in slightly lower than the market expectation for a deficit of $79.1 billion.
October exports were $256.6 billion, $1.9 billion less than September exports,” the publication further read. “October imports were $334.8 billion, $2.2 billion more than September imports.
MSCI’s all-country world index, a gauge of stock performance in over 40 countries, fell 1.26% to record a third lower successive day after hitting a three-month high last week.
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