Markets are awaiting today's policy meeting at the US Federal Reserve, although the Fed is not expected to change rates or make any other major moves.
➡️ The US Federal Reserve will hold a policy meeting later today, at which it is expected to leave rates unchanged and say nothing more. Markets have priced in a 98% chance of rates remaining unchanged, so a rate cut would be a huge shock and would likely send the dollar crashing and stocks soaring (at least in the short term) if that happened.
➡️ Data on the ISM US Manufacturing PMI and JOLTS job openings data will be released today, as well as the ADP forecast on the change in nonfarm employment.
➡️ The USD/JPY currency pair rose strongly yesterday, trading well above the big round number of 151 yen, not far from the 30-year high price reached last year, but then fell after Japanese currency diplomat Kanda said he would not rule out any move to respond to disorderly movements in the foreign exchange market and would stand by to intervene “if necessary.”. Despite this, this currency pair in particular, and the Japanese yen in general, will remain interesting for trend traders. In the Forex market since the opening of Tokyo, the strongest major currency has been the New Zealand dollar, while the Japanese yen has been the weakest. Also the EUR/JPY currency cross has reached a new long-term high.
➡️ The USD/CAD currency pair reached a new one-year high yesterday, supported by a strong US dollar and falling crude oil prices.
➡️ The prices of some soft commodities continued to rise significantly, with futures of cocoa which reached new long-term highs the day before yesterday.
➡️ They has rallied sharply over the past three and a half weeks on risk-off sentiment, breaking its usual positive correlation with stock markets, which have mostly weakened significantly over the same period. However, the price has cooled and remains stuck below the big round number of $2,000. It is the all-time high at $2,070 which appears to be the most technically significant level. I will try to get involved on the long side if we get a solidly bullish daily close above $ 2,070.
➡️ US central bank consumer confidence and labor cost index data both came in higher than expected, suggesting a still-vibrant U.S. economy.
➡️ New Zealand's unemployment rate remained unchanged yesterday at 3.9%.
➡️ The price of crude oil has continued to weaken, as it appears that despite Israel's ground invasion of Gaza, the war has not yet expanded, triggering greater optimism that this war can be contained.
➡️ Today is a public holiday in France and Italy.
Credit by DailyForex.com
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