Dollar Subdued After Wall Street Records Second Best Day of the Year

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1. Dollar Subdued After Wall Street Records Second Best Day of the Year

The dollar hovered near a 7-week low on a Fed rate cut prospect, giving room for other safe-havens to advance.US markets surged on Tuesday after Federal Reserve Chairman Jerome Powell signalled that the central bank was open to easing monetary policy to save the economy. Specifically, Fed chair Jay Powell’s statements yesterday confirmed that the Fed would be looking into cutting rates if needed and brought some euphoria to the markets leading to the biggest stock market rally since the beginning of the year.*

 

2. EUR & GBP Advance

The EUR is taking advantage of the USD weakness and also with the latest agreement out of Italy it appears for the most part that the political landscape in Europe is starting to normalize again. The GBP is also a little higher yet not out of the woods considering the staggering amount of uncertainty around how Brexit may or may not happen.**

 

3. What to Watch in Today’s Markets

Overnight Chinese services PMI came in softer, while China fined a Ford venture as the trade war further escalated. Meanwhile, the tariffs on Mexico are to be imposed from next Monday. Republican senators who fear the tariffs’ impact on the economy and their home states may try to block the tariffs, but any such move will be vetoed by the president. The calendar is quite data heavy today with a number of services PMI and ISM releases in the US which could already be the turning point to put back the focus on the economy slowing down.***

 

4. Oil Prices Dip

Oil prices continued to slide today, dragged down by a surprise gain in U.S. inventories and comments from the head of Russian state oil producer Rosneft questioning the point of a deal with OPEC to withhold supplies. It seems that oil is poised to drift lower on the overall global developments.****

 

5. Gold Firms, BTC Drops Below $8K

Spot gold firmed near a 3-month peak early this morning, now eyeing the high of 2018 around the $1,365 as Fed rate cut expectations grew and was last seen trading at $1338.25 at 7:50 GMT. Elsewhere, BTC started to drop below the $7,700 yesterday in the evening and is presently fighting to reclaim that level that could prove the most important one in term as it will reveal whether the market has a chance of continuing upwards or whether we should expect a steeper drop after an admittedly impressive bull-run.*****

 

You can find and trade CFDs on all of the above mentioned assets on BDSwiss Forex/CFD platforms.

Sources:
*CNBC Jun 5, 2019 2:48 AM ET
**Reuters Jun 5, 2019 3:53 AM ET
***FXStreet Jun 5, 2019 03:07 AM ET
****Bloomberg Jun 5, 2019 06:13 AM ET
*** Investing Jun 5, 2019 08:54 AM ET

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