Two members of the US FOMC made comments last night suggesting the Fed may not need to raise rates again this year, sending Treasury yields sharply lower and stock markets higher.
➡️ Yesterday, two members of the US Federal Reserve's FOMC made comments suggesting that recent upward movements in US Treasury yields may have actually tightened monetary conditions in a way that makes further rate hikes unnecessary in 2023. Markets were expecting at least another rise to 0.25% this year. The comments had the effect of sending the US dollar and yields sharply lower, boosting the stock market.
➡️ The war in the Middle East has so far remained confined to Israel and Gaza, despite yesterday's incidents on the Israel-Lebanon border resulting in small numbers of both IDF and Hezbollah deaths. However, the war could still spread, with Israel fully mobilized after recalling 300,000 reservists. Crude oil gave back some of Monday's gains in the final hours.
➡️ They continued its strong rise yesterday.
➡️ There was little directional movement in the Forex market during the Asian session. Trend traders in the Forex market will be more interested in being long on USD/JPY and short on EUR/USD as these are the two major dollar pairs that historically tend to trend most reliably and both have valid long-term trends. The Israeli Shekel also weakened dramatically yesterday, with USD/ILS almost reaching the big round number at 4.00, but is now regaining some strength.
➡️ It may be a relatively quiet day in the markets today, as no impactful economic data is expected.
Credit by DailyForex.com