Market Drivers – US Session – Thursday, July 14

Recession-linked fears have put the US dollar on the bullish path throughout the first half of the day, although cooling expectations of a 100 bps rate hike in the US triggered a corrective slide. The EUR/USD pair plunged to 0.9951 but finished the day at around 1.0020.

CME FedWatch is now showing a 52% chance of a 75 bps rate hike in July, this is supported by Fed Governor Christopher Waller’s comments.

Gold reached a fresh 2022 low of $1,697.56 a troy ounce, now hovering around $1,710 – $1,730 per ounce.

Economic Data

The Producer Price Index (PPI) for final demand in the US climbed to 11.3% on a yearly basis in June from 10.9% in May, the data published by the US Bureau of Labor Statistics revealed on Thursday. This print surpassed the market expectation of 10.7%.

Other Developments

Global indexes plummeted at the beginning of the day, although Waller’s words helped Wall Street to trim most of its intraday losses. As a result, high-yielding currencies recovered some of the ground lost against the greenback.

Crises in Europe added to the shared currency’s weakness. Gazprom, the Russian energy giant, said that it would not guarantee to resume the functioning of the Nord Stream 1 pipeline after it was shut down for repairs.

German Economy Minister Robert Habeck said that the uncertainty around gas deliveries “is clouding the economic outlook considerably heading into the second half of the year.” Also, Italian Prime Minister Mario Draghi announced he is resigning.

The GBP/USD pair fell to 1.1759, its lowest since March 2020, and now trades around 1.1820. Political noise in the United Kingdom, after Prime Minister, announced his resignation and Tories began an election process, weighed on the pound.


The USD/CAD pair soared to 1.3223, weighed by equities and falling oil prices but retreated towards the 1.3100 price zone. The barrel of WTI traded as low as $90.53 a barrel, now hovering around $96.30.

The AUD/USD pair edged modestly lower and trades at 0.6750, despite upbeat Australian employment figures.

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