Market Drivers – US Session – 7 April

Mohamed Abdelhamid 7 April, 2022 3:12 am Commodities, Forex Market, Market Update

Inflation in the Eurozone is high and the European Central Bank may soon need to raise interest rates as a result according to statements by Bundesbank President Joachim Nagel on Wednesday.

“What we are seeing at the moment suggests that savers may soon be able to look forward to higher interest rates again,” Nagel said. So, the US dollar retained its strength on Wednesday, as the focus remained on geopolitical tensions and aggressive central banks.

Economic Data
The North American session witnessed no notable economic data of record on Wednesday.

Other Developments
The US Federal Reserve unveiled the Minutes of its latest meeting, which reminded market players of the aggressive stance of the central bank. Policymakers are determined to move the monetary policy to neutral “expeditiously.” Additionally, the statement reads: “participants also noted that depending on economic and financial developments, a move to a tighter policy stance could be warranted.”

US President Joe Biden announced an executive order which will ban new investments in Russia. European leaders, on the other hand, were unable to reach an agreement on banning Russian coal, although they said it was due to a technical issue and that they will discuss it again on Thursday. Meanwhile, European Commission President Ursula von der Leyen said that new sanctions against the Kremlin would not be the last.

The EUR/USD pair trades below 1.0900, while GBP/USD hovers around 1.3070. Commodity-linked currencies are under strong selling pressure, with AUD/USD changing hands at 0.7510 and USD/CAD trading at 1.2530.

Crude oil prices were sharply down, undermined by the soft tone of Wall Street, now at around $97.00 a barrel. Global indexes closed in the red, with US ones further weighed by FOMC Meeting Minutes. Gold price held within familiar levels, now trading at around $1,924 per ounce.

Also Read:

WTI skids below EMA for first time in 2022