On Thursday, July 8, here’s everything you need to know:
Despite the rather dovish FOMC Meeting Minutes, markets remain buoyant as the dollar refuses to sink. After completing its strategic review, the ECB is expected to announce more flexibility on its inflation objective. Gold, oil, and cryptocurrencies are all losing ground.
Strength of the dollar: The dollar has held on to most of its gains, only slightly reversing after the Federal Reserve’s minutes revealed that there is no rush to trim the bank’s bond-buying program.
While some members expected inflation to rise faster than expected, markets were unfazed. Others argued that the economy hasn’t progressed far enough and that more proof is needed before taking action. That message helped to counterbalance the hawkish choice. The dollar fell in the aftermath, but quickly recovered.
The minutes of the FOMC make no new policy or bond-timing ground.
Weekly Unemployment claims in the United States are expected to fall from 364,000 last week, confirming the labor market’s rebound.
The European Central Bank’s strategic assessment is complete, and the conclusions will be released on Thursday. President Christine Lagarde of the European Central Bank is expected to announce a more balanced inflation objective, aiming for a symmetrical 2% target rather than one that is “below, but near to 2%.”
House prices might be included in the Frankfurt-based institution’s Consumer Price Index computations, pushing inflation higher and making ECB policy more hawkish. Incorporating unemployment and inequality within the bank’s objectives, on the other hand, would result in a more dovish policy.
See ECB Strategic Review: A Sneak Peek. There are three potential EUR/USD movers to keep an eye on.
Prior to the ECB announcement, the EUR/USD is languishing around 1.18, pulled down by dollar strength and fears about the spread of the Delta covid version in Spain and Portugal. As concerns over the UK’s reopening linger, the GBP/USD is trading below 1.38.
Despite lower US yields and a strong dollar, gold is struggling to hold $1,800. WTI Crude Oil fell below $72 on Wednesday, as some speculated that the UAE would go it alone in increasing its oil output, separating itself from Saudi Arabia. The OPEC+ summit came to a close without a deal.
Cryptocurrencies are faltering, with Bitcoin trading below $34,000 and Ethereum trading around $2,300. The recent crackdown on Binance, one of the largest cryptocurrency exchanges in the world, is affecting mood.
More Shiba Inu prices rise slightly but remain above crucial levels, with a 40% increase on the horizon./n
