The US Federal Reserve surprised markets yesterday by predicting that it would make three rate cuts of 0.25% each during 2024, leading to a rally in risk assets and a decline in the US dollar.
➡️ Yesterday the US Federal Reserve held a monetary policy meeting in which it surprised the markets by predicting that it would still be likely to raise 3 rates in 2024 and by raising its forecasts for inflation and economic growth in 2024. The Fed also sees longer-term rates a bit higher beyond 2024, while leaving its rate unchanged for the fifth consecutive meeting. Powell's view can be summed up as follows: "before we cut we need to have more evidence that inflation is falling." The markets reacted to this dovish surprise by sending all the major US stock indexes in particular the S&P 500 index , to new record highs, while the US dollar was moderately sold off. Trend traders will be very interested in having long positions on the major US stock market indexes, as the price action suggests they will continue to advance.
➡️ Following yesterday's Fed meeting, policy meetings of the Bank of England and the Swiss National Bank will be held today. Both banks are expected to leave theirs unchanged interest rates .
➡️ After yesterday's Fed meeting, gold rose strongly to a new all-time high, trading above $2,200 an ounce for the first time.
➡️ The Japanese yen regained some of its earlier losses following its decline after the Bank of Japan raised its interest rate on Tuesday for the first time since 2007, while the Japanese Finance Minister spoke about the yen, saying he was “looking at the FX market with an attentive eye." strong sense of urgency." The USD/JPY currency pair it is some way off the 4 month high reached yesterday, but there will still be traders interested in looking for long trades here.
➡️ In the Forex market, the Australian dollar has been the strongest major currency since Tokyo opened today. The US dollar was the weakest. This brings attention on the AUD/USD currency pair Today. When this couple advances it is typical risk appetite indicator .
➡️ Bitcoin It recovered a lot of ground yesterday in line with the Fed-led risk appetite rally, but is still significantly away from its record high near $74,000.
➡️ In the commodity market, cocoa futures they rose yesterday to close at a new record price. Trend traders will however be keen to get involved in this long-lasting trend on the Long side.
➡️ CPI data (inflation) of the UK published yesterday were lower than expected, showing a decline from an annualized rate of 4.0% to 3.4% when only a decline to 3.5% was widely expected.
➡️ Important data regarding Flash services and production for the United States, Germany, United Kingdom and France will be released today.
➡️ Yesterday's release of New Zealand's GDP data was slightly worse than expected, showing a quarterly decline of 0.1% when it was widely expected to rise by the same amount.
➡️ The previous release of Australian unemployment data was much better than expected, showing a drop in the unemployment rate from 4.1% to 3.7% when only 4.0% was expected.
Credit by DailyForex.com
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