Forex News Timeline
22:56 AUD/USD edges lower as investors remain focused on inflation and rate expectations
The Australian Dollar (AUD) is trading lower against the US Dollar (USD) on Wednesday, erasing earlier gains following the progress in US-China trade talks.
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.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Australia will release its Inflation Expectations for June on Thursday, which could shift interest rate bets.The United States will release the US Producer Price Index data for May, providing insight into wholesale inflation pressures.AUD/USD remains vulnerable to these macroeconomic data releases, which continue to drive rate expectations and consumer sentiment.The Australian Dollar (AUD) is trading lower against the US Dollar (USD) on Wednesday, erasing earlier gains following the progress in US-China trade talks.With AUD/USD prices remaining above the 0.6500 psychological level of support at the time of writing, inflation data could continue to drive prices on Thursday.Australia Inflation Expectations and US PPI could take focusOn Thursday, Australia will release its Consumer Inflation Expectations for June, which reflect consumers' expectations of future inflation over the next 12 months. The focus will be on whether these expectations have changed from the 4.1% reading in May. In the United States, Initial Jobless Claims are expected to rise to 240,000 over the past week, following a reading of 247,000 last week. Additionally, markets will be closely watching the release of the US Producer Price Index (PPI) for May, which measures inflation at the wholesale level. The monthly PPI rate for May is expected to increase to 0.2%, following a contraction of 0.5% in April. The annual PPI rate is projected to rise to 2.6%, up from 2.4% in the previous month. During the same period, the annual core PPI inflation rate, which excludes the more volatile food and energy prices, is expected to remain steady at 3.1%. On Wednesday, the Consumer Price Index (CPI) for May showed a surprising decline, with both monthly and annual figures falling below expectations. These results are likely to influence market expectations regarding the Federal Reserve's (Fed) policy direction. AUD/USD trades below 0.6500The AUD/USD pair is currently trading below the 61.8% Fibonacci retracement level of the decline from September to April, which is around 0.6549. The pair has edged below 0.6500 at the time of writing.The 20-day Simple Moving Average (SMA) has consistently acted as dynamic support, helping to maintain the short-term trend near 0.6463. On the other hand, the 200-day SMA, presently near 0.6430, stands as a significant medium-term support level. AUD/USD daily chartA decisive break above 0.6545 could open the path for a movement toward 0.6722, which corresponds to the 78.6% Fibonacci retracement. Conversely, a breakdown from the current wedge pattern could lead to a retracement toward 0.6428 (the 50% Fibonacci level) or even the November low near 0.6339. The price action in the upcoming sessions will be crucial in determining whether the bullish momentum continues or reverses. Economic Indicator Consumer Inflation Expectations The Consumer Inflation Expectation released by the Melbourne Institute presents the consumer expectations of future inflation during the next 12 months. The higher expectations, the stronger the effect they will have on a probability of a rate hike by the RBA. Therefore, a high reading should be taken as positive, or bullish, for the AUD, while a low expectations are seen as negative or bearish. Read more. Next release: Thu Jun 12, 2025 01:00 Frequency: Monthly Consensus: - Previous: 4.1% Source: University of Melbourne Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
22:13 Canadian Dollar holds steady amid Greenback weakness
The Canadian Dollar (CAD) is holding close to multi-month highs against the US Dollar (USD) on Wednesday. The Loonie caught a thin boost from declining Greenback bids, with broad-market investor sentiment bolstered by a cooler-than-expected US Consumer Price Index (CPI).
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Canadian Dollar FAQs What key factors drive the Canadian Dollar? The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar. How do the decisions of the Bank of Canada impact the Canadian Dollar? The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive. How does the price of Oil impact the Canadian Dollar? The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD. How does inflation data impact the value of the Canadian Dollar? While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar. How does economic data influence the value of the Canadian Dollar? Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
Canadian Dollar FAQs What key factors drive the Canadian Dollar? The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar. How do the decisions of the Bank of Canada impact the Canadian Dollar? The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive. How does the price of Oil impact the Canadian Dollar? The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD. How does inflation data impact the value of the Canadian Dollar? While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar. How does economic data influence the value of the Canadian Dollar? Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
22:05 Mexican Peso strengthens to 10-month highs on a weaker USD
The Mexican Peso (MXN) is trading at its strongest level in 10 months against the US Dollar (USD) on Wednesday, supported by improving risk sentiment and ongoing trade negotiations between Mexico and the United States.
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At the time of writing, USD/MXN is hovering near 18.90, extending its multi-week downtrend as investors respond to shifting fiscal and trade dynamics.US Treasury Secretary Scott Bessent’s testimony before the House Ways & Means Committee has brought US fiscal policy back into focus, with lawmakers debating the sustainability of extending tax cuts and introducing so-called “revenge tax” tariffs targeting foreign companies. The fiscal uncertainty, combined with structural deficits, is weighing on the US Dollar broadly.Meanwhile, US–Mexico trade talks are ongoing, with both nations reportedly engaged in advanced discussions to ease the 50% tariffs imposed by the US on global steel imports earlier this month. A quota-based system is under consideration, which would allow a defined volume of Mexican steel to enter the US at a reduced tariff rate or duty-free. However, no formal framework has been finalized, and critical details — including quota size and rate thresholds — are still under negotiation.Tensions escalated after the tariff rate was raised from 25% to 50% on June 4, prompting Mexico to file for an exemption last Friday. Officials have warned of retaliatory tariffs if no agreement is reached in the coming days, keeping market participants alert for headline-driven volatility.Mexican Peso daily digest: Key market moversPresident Donald Trump announced on Truth Social on Wednesday that “Our deal with China is done, subject to final approval with President Xi and me.” He said the US would impose 55% tariffs on Chinese goods, while China would keep its 10% tariff on US goods.The US Consumer Price Index (CPI) came in softer than expected on Wednesday. Headline inflation rose 2.4% YoY in May, slightly below the 2.5% forecast and up from April’s 2.3%. The core CPI, which excludes food and energy, remained steady at 2.8%, missing expectations of a rise to 2.9%. On a monthly basis, the CPI increased by just 0.1%, undershooting the 0.2% estimate, while the core CPI also rose by 0.1%, sharply below the 0.3% forecast. Mexico’s Industrial Output data on Wednesday showed a monthly increase of 0.1% in April after a 1.2% contraction in March. The annual rate showed a 4% contraction, after a 1.9% rise in March.Mexico’s inflation data on Monday rose to 4.42%, exceeding Banxico's 3% ±1% target, prompting caution. However, in a poll published by Reuters on Wednesday, the majority of analysts still expect a 50 bps rate cut at the June 26 meeting, which would bring the benchmark rate down to 8.0% despite the inflation uptick.USD/MXN breaks below 19.00 psychological supportThe Mexican Peso extended its rally against the US Dollar on Wednesday, with USD/MXN falling below critical support at the 61.8% Fibonacci retracement of the July–February rally at 19.01, confirming a bearish continuation pattern. The pair is now trading near 18.90, marking its lowest level since August 2024, and down nearly 3% this month.This latest move lower follows repeated rejections at the 10-day and 20-day Simple Moving Averages (SMA), currently at 19.17 and 19.25, which have acted as dynamic resistance since early May. With momentum firmly to the downside, the Peso continues to outperform amid supportive macro sentiment and optimism around a potential US–Mexico trade resolution.A decisive daily close below 18.60 could pave the way toward 18.40, with downside momentum likely to accelerate if US Treasury yields retreat further or if Banxico signals confidence in easing policy without jeopardizing inflation control. That said, short-term bullish rebound risks are emerging, with the Relative Strength Index (RSI) hovering near 30, indicating oversold conditions that may trigger consolidation or a corrective bounce. A recovery above 19.01 would help neutralize immediate bearish momentum, but a sustained break above the 20-day SMA at 19.25 is required to signal a broader reversal. If that level is cleared, additional upside targets come into view at 19.44 and 19.57, where key Fib levels and moving averages converge.USD/MXN daily chart Mexican Peso FAQs What key factors drive the Mexican Peso? The Mexican Peso (MXN) is the most traded currency among its Latin American peers. Its value is broadly determined by the performance of the Mexican economy, the country’s central bank’s policy, the amount of foreign investment in the country and even the levels of remittances sent by Mexicans who live abroad, particularly in the United States. Geopolitical trends can also move MXN: for example, the process of nearshoring – or the decision by some firms to relocate manufacturing capacity and supply chains closer to their home countries – is also seen as a catalyst for the Mexican currency as the country is considered a key manufacturing hub in the American continent. Another catalyst for MXN is Oil prices as Mexico is a key exporter of the commodity. How do decisions of the Banxico impact the Mexican Peso? The main objective of Mexico’s central bank, also known as Banxico, is to maintain inflation at low and stable levels (at or close to its target of 3%, the midpoint in a tolerance band of between 2% and 4%). To this end, the bank sets an appropriate level of interest rates. When inflation is too high, Banxico will attempt to tame it by raising interest rates, making it more expensive for households and businesses to borrow money, thus cooling demand and the overall economy. Higher interest rates are generally positive for the Mexican Peso (MXN) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken MXN. How does economic data influence the value of the Mexican Peso? Macroeconomic data releases are key to assess the state of the economy and can have an impact on the Mexican Peso (MXN) valuation. A strong Mexican economy, based on high economic growth, low unemployment and high confidence is good for MXN. Not only does it attract more foreign investment but it may encourage the Bank of Mexico (Banxico) to increase interest rates, particularly if this strength comes together with elevated inflation. However, if economic data is weak, MXN is likely to depreciate. How does broader risk sentiment impact the Mexican Peso? As an emerging-market currency, the Mexican Peso (MXN) tends to strive during risk-on periods, or when investors perceive that broader market risks are low and thus are eager to engage with investments that carry a higher risk. Conversely, MXN tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
22:01 Forex Today: US inflation and jobs take centre stage alongside UK data
Poor US inflation data and increasing bets of a Fed rate cut in September, coupled with the US-China trade agreement, kept the US Dollar on the defensive throughout the day.
Poor US inflation data and increasing bets of a Fed rate cut in September, coupled with the US-China trade agreement, kept the US Dollar on the defensive throughout the day.Here's what to watch on Thursday, June 12:
The US Dollar Index (DXY) broke below the 99.00 support to hit new multi-day troughs amid mixed US yields across the curve. Producer Prices will be in the spotlight, seconded by weekly Initial Jobless Claims.
The sell-off in the Greenback gained extra momentum, causing EUR/USD to rise further and approach the 1.1500 barrier. The ECB’s Schnabel, De Guindos, and Elderson are all due to speak.
GBP/USD regained the smile and kept the trade above the 1.3500 hurdle, leaving behind Tuesday’s pullback. An interesting docket will feature GDP figures, Industrial and Manufacturing Production, Balance of Trade results, Construction Output, the RICS House Price Balance, and the NIESR Monthly GDP Tracker.
USD/JPY maintained its erratic performance so far this week, fading Tuesday’s gains and resuming its downtrend to the 144.30 zone. The BSI Large Manufacturing data is due, seconded by the weekly Foreign Bond Investment prints.
AUD/USD rose to new yearly peaks near 0.6550, just to retrace that move and end the day with modest losses near 0.6500. Next on tap in Oz will be the Inflation Expectations tracked by the Melbourne Institute and the speech by the RBA’s Jacobs.
Positive headlines from the US-China trade front boosted crude oil prices, propelling them to new two-month highs beyond the $68.00 mark per barrel of American WTI,
Gold prices extended their gradual weekly advance, hitting multi-day highs around $3,360 per troy ounce following the selling interest in the US Dollar and the US-China trade agreement. Silver prices added to Tuesday’s pullback and eased to two-day lows, coming just pips away from the key support at the $36.00 mark per ounce.
21:44 United States 10-Year Note Auction climbed from previous 4.342% to 4.421%
United States 10-Year Note Auction climbed from previous 4.342% to 4.421%
21:17 ECB's Villeroy: The ECB policy is not static
ECB board member François Villeroy de Galhau signalled that while the ECB is operating from a position of strength, its stance is far from fixed.
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ECB board member François Villeroy de Galhau signalled that while the ECB is operating from a position of strength, its stance is far from fixed.Key QuotesThe ECB's situation is favorable, doesn't mean that policy is static.I don't see deflation, but the ECB has tools to react.The Trump administration's chaos weighs on global growth. ECB FAQs What is the ECB and how does it influence the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region.
The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. What is Quantitative Easing (QE) and how does it affect the Euro? In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro.
QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic. What is Quantitative tightening (QT) and how does it affect the Euro? Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.
21:13 Gold price rises on soft US CPI, traders price in Fed rate cuts
Gold prices posted modest gains of over 0.22% on Wednesday as the latest inflation report in the United States (US) revealed that prices are cooling. Hence, investors increased their bets that the Federal Reserve (Fed) would resume its easing cycle in September. The XAU/USD trades at $3,327.
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Hence, investors increased their bets that the Federal Reserve (Fed) would resume its easing cycle in September. The XAU/USD trades at $3,327.May’s Consumer Price Index (CPI) in the US provided an opportunity for Gold buyers. The print dipped compared to April’s data, and Bullion prices spiked toward a daily peak of $3,360 – in the headline – before erasing those gains.Uncertainty around negotiations between the US and China will most likely keep Gold prices higher. Although US Commerce Secretary Howard Lutnick said that they’ve reached a framework to implement the Geneva Consensus, it is pending approval from US President Donald Trump and his counterpart Xi Jinping.At the same time, the Chinese Vice Commerce Minister Li Chenggang said that talks “involved in-depth exchanges and communication had been rational and candid.” He added that he will report on the framework to leaders and expects that the progress could increase trust between the two countries.Traders' focus shifted to the release of the Producer Price Index (PPI) figures and jobs data. The latest ISM Purchasing Managers Index (PMI) surveys showed that input prices for companies had risen. Although May’s CPI data was positive, analysts suggest that households are yet to feel the impact of tariffs.Daily digest market movers: Gold holds firm as the Greenback, US yields plungeThe weakness of the US Dollar might keep Gold prices underpinned. The US Dollar Index (DXY), which tracks the value of the Dollar against a basket of peers, falls 0.44% to 98.61, reaching four-day lows.US Treasury yields are collapsing; The US 10-year Treasury yield has dropped five basis points (bps) to 4.42%. US real yields followed suit, falling by five basis points to 2.13%, boosting Bullion‘s advance.US inflation rose less than expected in May, with headline CPI up 2.4% YoY, below the 2.5% forecast but slightly above April’s 2.3%. The Core CPI remained steady at 2.8% YoY, matching the previous month's figure and indicating persistent yet stable underlying price pressure.Geopolitical tensions remain high as US President Trump told Fox News that Iran is becoming much more aggressive in nuclear talks. The Iranian Foreign Minister said, “As we resume talks on Sunday, it is clear that an agreement that can ensure the continued peaceful nature of Iran's nuclear program is within reach — and could be achieved rapidly.”Money markets suggest that traders are pricing in 47.5 basis points of easing toward the end of the year, according to Prime Market Terminal data.Source: Prime Market TerminalXAU/USD technical outlook: Gold price consolidates below $3,400Gold price remains upwardly biased, but price action over the last two days indicates that buyers are reluctant to drive the spot price above $3,400. The Relative Strength Index (RSI) shifted flat near its neutral line, further confirmation of a trendless market.For a bullish continuation, XAU/USD needs to climb above $3,350 to challenge $3,400. Further strength lies in $3,450 and the all-time high (ATH) at $3,500.Conversely, if Gold slumps beneath $3,300, it opens the door to test key support levels, such as the 50-day Simple Moving Average (SMA) at $3,269. Below that level lies the April 3 high-turned-support at $3,167. Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
21:00 United States Monthly Budget Statement registered at $-316B above expectations ($-325B) in May
United States Monthly Budget Statement registered at $-316B above expectations ($-325B) in May
20:16 US Treasury Secretary Bessent: The US will set a global duty level for de minimis imports
United States (US) Treasury Secretary Scott Bessent hit the newswires on Wednesday, giving his thoughts on the US debt ceiling, and also teased around the idea of the Trump administration introducing a "de minimis" tariff level, which would see US companies find some breathing room on tariffs up to
United States (US) Treasury Secretary Scott Bessent hit the newswires on Wednesday, giving his thoughts on the US debt ceiling, and also teased around the idea of the Trump administration introducing a "de minimis" tariff level, which would see US companies find some breathing room on tariffs up to a certain level of imports.Key highlightsBeware of the unintended impact of a Russia sanctions bill.
Give the administration some flexibility here.
I am prepared to roll the tape forward for trading partners negotiating in good faith.
If the debt limit is not sorted, it could be the biggest crisis since 2008-09.
It is unthinkable that a debt-ceiling breach could happen.
The US debt ceiling must be raised and extended.
The bond market functioned very well amid April volatility. The US continues to be the most stable bond market.
April bond volatility never involved stability worries.
The US will set a global duty level for de minimis imports.
China pushed back on de minimis tariffs.
We want a deficit ratio under 4% by end of Trump's term.
It is impossible to say if all will benefit from the tax bill.
It remains to be seen whether the tax bill adds to US debt.
Trade talks with China will be a much longer process.
Under Biden, China didn't think it had to stick to the deal.
If prices go up due to tariffs, it will be one-time.
The CPI showed yet another fantastic inflation number.Market reactionOverall market impact remains limited as investors focus on inflation data, trade talks, and interest rate cut hopes. US equity markets are broadly rising, and the US Dollar (USD) Index (DXY) has fallen back into recent lows near 98.50.
Give the administration some flexibility here.
I am prepared to roll the tape forward for trading partners negotiating in good faith.
If the debt limit is not sorted, it could be the biggest crisis since 2008-09.
It is unthinkable that a debt-ceiling breach could happen.
The US debt ceiling must be raised and extended.
The bond market functioned very well amid April volatility. The US continues to be the most stable bond market.
April bond volatility never involved stability worries.
The US will set a global duty level for de minimis imports.
China pushed back on de minimis tariffs.
We want a deficit ratio under 4% by end of Trump's term.
It is impossible to say if all will benefit from the tax bill.
It remains to be seen whether the tax bill adds to US debt.
Trade talks with China will be a much longer process.
Under Biden, China didn't think it had to stick to the deal.
If prices go up due to tariffs, it will be one-time.
The CPI showed yet another fantastic inflation number.Market reactionOverall market impact remains limited as investors focus on inflation data, trade talks, and interest rate cut hopes. US equity markets are broadly rising, and the US Dollar (USD) Index (DXY) has fallen back into recent lows near 98.50.
20:15 USD/CHF weakens as President Trump’s tax bill comes back in focus
The Swiss Franc (CHF) is receiving a slight boost against the US Dollar (USD) during the American session on Wednesday, with a weaker Greenback driving gains.
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Concerns have been raised over the fiscal sustainability of extending tax cuts and implementing aggressive ‘revenge tax’ tariffs.Questions were asked about foreign investment restrictions, cybersecurity vulnerabilities and potential economic retaliation abroad.The hearing comes as lawmakers debate a controversial tax-cut and tariff package designed to extend key elements of the 2017 tax reforms and introduce new levies, dubbed the "revenge tax" on firms operating in jurisdictions with digital service or global minimum taxes.While Bessent emphasized the package is a “fiscal bill, not a revenge bill,” the proposals carry broad implications for revenue sustainability, trade relations, and foreign investment.US inflation falls in May, US-China tensions ease, but US Dollar strength remains limitedThe market focus in the European session centered on the release of the Consumer Price Index (CPI) for May and the US-China trade talks held in London. US President Trump confirmed that the US-China agreement was a “done deal”, boosting market sentiment.The US Consumer Price Index (CPI) came in softer than expected on Wednesday. Headline inflation rose 2.4% YoY in May, slightly below the 2.5% forecast and up from April’s 2.3%. The core CPI, which excludes food and energy, remained steady at 2.8%, missing expectations of a rise to 2.9%. On a monthly basis, the CPI increased by just 0.1%, undershooting the 0.2% estimate, while the core CPI also rose by 0.1%, sharply below the 0.3% forecast. Risk sentiment FAQs What do the terms"risk-on" and "risk-off" mean when referring to sentiment in financial markets? In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest. What are the key assets to track to understand risk sentiment dynamics? Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit. Which currencies strengthen when sentiment is "risk-on"? The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity. Which currencies strengthen when sentiment is "risk-off"? The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
20:01 Dow Jones Industrial Average breaks higher after US CPI beat
The Dow Jones Industrial Average (DJIA) rose on Wednesday, bolstered by cooler-than-expected Consumer Price Index (CPI) inflation data for May, as well as a tentative trade policy framework following two days of trade talks in London.
.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Dow Jones is testing above the 43,000 level for the first time since February.US CPI inflation came in cooler than expected, boosting investor hopes for Fed rate cuts.Trade tensions with China are easing after delegates from both sides reached a consensus.The Dow Jones Industrial Average (DJIA) rose on Wednesday, bolstered by cooler-than-expected Consumer Price Index (CPI) inflation data for May, as well as a tentative trade policy framework following two days of trade talks in London. The framework still needs final approval from both President Donald Trump and Chinese President Xi Jinping; however, markets are hopeful that the progress will see both sides continuing to ease off from recent trade war rhetoric.CPI inflation in May broadly came in below expectations, helping to bolster broad-market investor sentiment. Still, there are some glaring price volatility difficulties facing policymakers through the remainder of the year. Headline CPI inflation still rose on an annualized basis, ticking up to 2.4% YoY, and core CPI inflation excluding volatile food and energy prices held steady at 2.8% YoY. The figures are still well above the Federal Reserve’s (Fed) 2% annual inflation target, but investors are still banking on increased odds of a Fed rate cut in September. According to the CME’s FedWatch Tool, the odds of at least a quarter-point rate trim at the Fed’s September rate call have risen to nearly 70%.After two days of private trade talks held in London, delegates from the Trump administration and the Chinese government have reached a preliminary trade policy framework, which now heads to the respective desks of Presidents Trump and Xi. According to social media posts by President Trump, tariffs on Chinese goods are being held at 55%, with China maintaining its 10% import tax on all American-made goods.Dow Jones price forecastThe Dow Jones Industrial Average has finally broken back above the 43,000 major price handle after months of tariff doldrums. Bullish investor sentiment has boosted the Dow Jones into 14-week highs, and has put the DJIA back on track to taking a fresh run at record highs above 45,000.Despite technical oscillators firmly pinned in overbought territory, the Dow Jones continues to drift higher, with the major equity index for all but four of the last 12 straight trading sessions. The DJIA is trading well north of the 200-day Exponential Moving Average (EMA) near 41,775, and bidders will be looking to price in a fresh technical floor at the old swing high point near 42,600.Dow Jones daily chart
Dow Jones FAQs What is the Dow Jones? The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500. What factors impact the Dow Jones Industrial Average? Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions. What is Dow Theory? Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits. How can I trade the DJIA? There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.
Dow Jones FAQs What is the Dow Jones? The Dow Jones Industrial Average, one of the oldest stock market indices in the world, is compiled of the 30 most traded stocks in the US. The index is price-weighted rather than weighted by capitalization. It is calculated by summing the prices of the constituent stocks and dividing them by a factor, currently 0.152. The index was founded by Charles Dow, who also founded the Wall Street Journal. In later years it has been criticized for not being broadly representative enough because it only tracks 30 conglomerates, unlike broader indices such as the S&P 500. What factors impact the Dow Jones Industrial Average? Many different factors drive the Dow Jones Industrial Average (DJIA). The aggregate performance of the component companies revealed in quarterly company earnings reports is the main one. US and global macroeconomic data also contributes as it impacts on investor sentiment. The level of interest rates, set by the Federal Reserve (Fed), also influences the DJIA as it affects the cost of credit, on which many corporations are heavily reliant. Therefore, inflation can be a major driver as well as other metrics which impact the Fed decisions. What is Dow Theory? Dow Theory is a method for identifying the primary trend of the stock market developed by Charles Dow. A key step is to compare the direction of the Dow Jones Industrial Average (DJIA) and the Dow Jones Transportation Average (DJTA) and only follow trends where both are moving in the same direction. Volume is a confirmatory criteria. The theory uses elements of peak and trough analysis. Dow’s theory posits three trend phases: accumulation, when smart money starts buying or selling; public participation, when the wider public joins in; and distribution, when the smart money exits. How can I trade the DJIA? There are a number of ways to trade the DJIA. One is to use ETFs which allow investors to trade the DJIA as a single security, rather than having to buy shares in all 30 constituent companies. A leading example is the SPDR Dow Jones Industrial Average ETF (DIA). DJIA futures contracts enable traders to speculate on the future value of the index and Options provide the right, but not the obligation, to buy or sell the index at a predetermined price in the future. Mutual funds enable investors to buy a share of a diversified portfolio of DJIA stocks thus providing exposure to the overall index.
19:00 Russia Consumer Price Index (MoM) rose from previous 0.4% to 0.43% in May
Russia Consumer Price Index (MoM) rose from previous 0.4% to 0.43% in May
18:54 GBP/USD climbs as US CPI miss fuels Fed rate cut bets
GBP/USD advances on Wednesday during the North American session, boosted by a weaker-than-expected consumer inflation report in the United States (US), which increased speculation that the Federal Reserve (Fed) may reduce borrowing costs twice in 2025.
.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}GBP/USD rises as May US CPI rose 2.4% YoY vs. 2.5% expected.Traders eye Thursday’s US PPI to confirm easing inflation trend.UK fiscal outlook dims as £2T budget adds to Gilt market pressure.GBP/USD advances on Wednesday during the North American session, boosted by a weaker-than-expected consumer inflation report in the United States (US), which increased speculation that the Federal Reserve (Fed) may reduce borrowing costs twice in 2025. At the time of writing, the pair trades at 1.3537, up 0.34%.Cable extends gains above 1.35 after soft US inflation print raises expectations for two Fed cuts in 2025The Consumer Price Index (CPI) in May rose less than estimates. Headline figures increased by 2.4% YoY, up from 2.3% a month ago but below forecasts for a 2.5% rise. Core CPI – which excludes volatile items like food and energy – advanced 2.8% YoY, unchanged compared with April’s data.Although the data warrants further easing by the Fed, the latest ISM Purchasing Managers Index (PMI) surveys showed that companies reported higher input prices. Hence, traders are eyeing the release of the Producer Price Index (PPI) on Thursday.According to Bloomberg, “The string of below-forecast inflation readings adds to evidence that consumers have yet to feel the pinch of President Donald Trump’s tariffs.”In the UK, the Chancellor of the Exchequer, Rachel Reeves, unveiled a £2 trillion budget, which she said “would put Britain on a path to national renewal,” according to the Financial Times. Public spending for the following years will be primarily focused on health, education, and capital projects.Analysts remained concerned about the UK's weak fiscal position, which drove the UK’s 30-year Gilts to their highest level in the G7 economies. In addition, an expected slowdown in the economy would most likely drive interest rates lower, which could be mitigated by a large fiscal stimulus package.Ahead in the week, the US economic docket will feature PPI and Initial Jobless Claims on Thursday. In the UK, the Bank of England (BoE) is projected to keep rates on hold next week.GBP/USD Price Forecast: Technical outlookFrom a technical standpoint, the GBP/USD seems to have bottomed near 1.3450 for the last two days, and has risen past the 20-day Simple Moving Average (SMA) of 1.3515, an indication that buyers are in charge.If GBP/USD clears 1.3600, look for a test of the yearly high at 1.3616 and 1.3700. Conversely, the first support would be the 20-day SMA and the 1.35 mark. Sellers are dragging prices below that level and looking for a test of the May 29 daily low of 1.3412. British Pound PRICE This week The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the strongest against the US Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.80% -0.16% -0.25% -0.23% -0.35% -0.43% -0.25% EUR 0.80% 0.63% 0.56% 0.57% 0.47% 0.36% 0.54% GBP 0.16% -0.63% 0.00% -0.06% -0.15% -0.27% -0.09% JPY 0.25% -0.56% 0.00% 0.02% -0.16% -0.24% -0.13% CAD 0.23% -0.57% 0.06% -0.02% -0.15% -0.20% -0.03% AUD 0.35% -0.47% 0.15% 0.16% 0.15% -0.10% 0.07% NZD 0.43% -0.36% 0.27% 0.24% 0.20% 0.10% 0.18% CHF 0.25% -0.54% 0.09% 0.13% 0.03% -0.07% -0.18% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
18:30 WTI Oil prices rally on US-China trade optimism and declining inventories
West Texas Intermediate (WTI) crude oil is rallying on Wednesday, climbing more than 2% intraday as markets react positively to renewed momentum in US–China trade negotiations and a larger-than-expected drop in US crude inventories.
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This significantly exceeded expectations for a modest 0.1 million barrel increase and followed a prior 4.304 million barrel drawdown, reinforcing signs of tightening supply.Together, the improving macro backdrop and fundamental support have reignited upside momentum in oil markets, with WTI now trading near $65.50, its highest levels since the beginning of April. WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
17:57 China's Copper ore imports are falling from record highs – Commerzbank
China's export growth slowed more sharply than most analysts had expected in May. Apparently, the 90-day moratorium on most tariffs has not been as effective as anticipated, Commerzbank's commodity analyst Carsten Fritsch notes.
China's export growth slowed more sharply than most analysts had expected in May. Apparently, the 90-day moratorium on most tariffs has not been as effective as anticipated, Commerzbank's commodity analyst Carsten Fritsch notes. China is trying to take advantage of the high international prices"However, base metal prices have been largely unaffected by the data: Aluminum is now trading at over $2,500 per ton, and Copper at almost $9,800 per ton. Meanwhile, Copper-specific news has been mixed: Chinese Copper ore imports have fallen significantly from their record high of almost 3 million tons in April and, at just under 2.4 million tons, are roughly in line with the average monthly level for the first quarter." "China's Copper smelters are likely to be well supplied with Copper ore, however, as imports in the first five months were still around 7% higher than in the previous year. In addition, although Copper smelters worldwide are struggling with low treatment and refining charges, China's smelters are in a relatively comfortable position. This is because the many new production facilities are modern, involving larger plants with lower costs, and in many cases they are state-owned." "This helps to a certain extent, at least. Regardless of this, according to media reports, Chinese smelters are trying to take advantage of the currently high international prices for sales on the LME and COMEX. This is because the halving of the import premium at the important import port of Yangshan indicates that domestic demand has weakened as is usual for the season."
17:54 Gold faces short-term selling – TDS
Despite mounting short-term pressure in Gold futures, algorithmic traders may only briefly trim positions before re-accumulating, with broader participation metrics suggesting a potential local bottom in prices, analysts say, TDS' Senior Commodity Strategist Daniel Ghali notes.
Despite mounting short-term pressure in Gold futures, algorithmic traders may only briefly trim positions before re-accumulating, with broader participation metrics suggesting a potential local bottom in prices, analysts say, TDS' Senior Commodity Strategist Daniel Ghali notes. Structural support intact amid low participation"Fear not, but algos could sell some Gold length for the first time since Liberation Day's fallout below $3375/oz in GCQ5. Short-term trend signals are under pressure following the recent rangebound trading regime, potentially resulting in selling activity tallying up to -4% of algos' max size this session (or 7% of their current size)." "In any scenario for prices, CTAs will re-accumulate this lost length over the coming week — and could potentially end up with an even larger position size on a continued uptape, driven primarily by vol-control and signal-strength." "Western macro funds remain extremely under-invested. Aggregate participation in CME Gold has reached extreme levels that have historically marked local lows in prices. Overbought but underowned."
17:30 United States EIA Crude Oil Stocks Change below forecasts (0.1M) in June 6: Actual (-3.644M)
United States EIA Crude Oil Stocks Change below forecasts (0.1M) in June 6: Actual (-3.644M)
16:59 Russia Foreign Trade down to $9.043B in April from previous $11.756B
Russia Foreign Trade down to $9.043B in April from previous $11.756B
16:53 Silver slips as price retreats from overbought territory on easing US-China trade talks
Silver prices are easing on Wednesday, retreating from multi-year highs as bullish momentum fades and traders lock in profits.
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A deeper downside could expose $34.00 and then the 50-day SMA at $33.01, while a sustained move higher would require a breakout above $37.49.The Relative Strength Index (RSI) at 67 remains near overbought territory, indicating stretched bullish momentum and increased likelihood of further consolidation or a short-term pullback. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
A deeper downside could expose $34.00 and then the 50-day SMA at $33.01, while a sustained move higher would require a breakout above $37.49.The Relative Strength Index (RSI) at 67 remains near overbought territory, indicating stretched bullish momentum and increased likelihood of further consolidation or a short-term pullback. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
16:28 AUD/USD climbs to new highs north of 0.6500
The upward trend in the Aussie Dollar (AUD) continues unabated this week, with AUD/USD advancing for the third consecutive day and reaching new yearly peaks near the 0.6550 level.
AUD/USD adds to the weekly advance, surpassing the 0.6500 mark.The US Dollar remains under pressure from economic data, US-China trade deal.The US CPI fell below consensus, rising by 2.4% YoY in May.The upward trend in the Aussie Dollar (AUD) continues unabated this week, with AUD/USD advancing for the third consecutive day and reaching new yearly peaks near the 0.6550 level.AUD/USD propped up by USD selling, trade optimismThe pair keeps its weekly recovery well in place on Wednesday in response to further pessimism hurting the Greenback, while auspicious news on the trade front also alleviated concerns over a protracted trade war.Indeed, the US Dollar accelerated its losses after US inflation figures showed the CPI rising less than initially estimated by 2.4% in the year to May. The core reading followed suit, coming in short of expectations and rising 2.8% from a year earlier.The weaker-than-expected US data has prompted investors to accelerate their bets of a probable rate cut by the Federal Reserve at its September gathering.Back to trade, US and China officials appear to have reached some common ground regarding rare earths at their gathering in London, although the agreement still needs confirmation from both President Trump and China’s Xi Jinping. Next on tap in OzGiven the lack of data releases in Australia on Wednesday, investors' attention shifts to the Melbourne Institute's release of Inflation Expectations on Thursday.What about techs?AUD/USD is trading in the low-0.6500s and is expected to face initial resistance at the YTD peak of 0.6545 (June 11), seconded by the November 2024 high of 0.6687 (November 7) and the 2024 top of 0.6942 (September 30), all preceding the key 0.7000 hurdle.On the other hand, the resumption of the bearish trend could spark an initial drop to the critical 200-day SMA at 0.6434, prior to the May trough of 0.6356 (May 12). The latter appears reinforced by the proximity of the provisional contention at the 55-day and 100-day SMAs at 0.6379 and 0.6342, respectively.The RSI near 59 suggests that further gains should remain in the pipeline in the short-term horizon, while the ADX past 26 is indicative of a modest strength of the trend.
16:20 GBP/USD holds above 1.3500 as USD loses strength after CPI
Following Tuesday's sharp decline, GBP/USD stages a rebound and trades above 1.3500 in the American session on Wednesday. At the time of press, the pair was up 0.23% on the day at 1.3528.
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.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}GBP/USD trades marginally higher on the day above 1.3500.The US Dollar struggles to outperform its rivals after inflation data.CPI and core CPI both rose at a softer pace than expected in May.Following Tuesday's sharp decline, GBP/USD stages a rebound and trades above 1.3500 in the American session on Wednesday. At the time of press, the pair was up 0.23% on the day at 1.3528. British Pound PRICE Today The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the New Zealand Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.42% -0.21% -0.14% -0.06% 0.00% 0.10% -0.34% EUR 0.42% 0.20% 0.25% 0.34% 0.42% 0.47% 0.07% GBP 0.21% -0.20% 0.06% 0.18% 0.24% 0.28% -0.14% JPY 0.14% -0.25% -0.06% 0.00% 0.17% 0.23% -0.22% CAD 0.06% -0.34% -0.18% 0.00% 0.10% 0.12% -0.31% AUD -0.01% -0.42% -0.24% -0.17% -0.10% 0.04% -0.36% NZD -0.10% -0.47% -0.28% -0.23% -0.12% -0.04% -0.41% CHF 0.34% -0.07% 0.14% 0.22% 0.31% 0.36% 0.41% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
On Tuesday, GBP/USD came under bearish pressure after the disappointing labor market data revived expectations for the Bank of England to lower the policy rate twice more this year. The renewed US Dollar (USD) weakness, however, helped the pair shake off the bearish pressure midweek.The data published by the US Bureau of Labor Statistics showed that the Consumer Price Index (CPI) rose 0.1% on a monthly basis in May. This reading followed the 0.2% increase recorded in April and came in below the market expectation of 0.2%. Similarly, the core CPI, which excludes volatile food and energy prices, increased 0.1% in this period, compared to analysts' estimate of 0.3%.The USD Index turned south following the May inflation data and was last seen losing 0.3% on the day at 98.75. In the meantime, the probability of the Federal Reserve leaving the policy rate unchanged in September declined toward 30% after the CPI data, from nearly 40% on Tuesday, as per the CME FedWatch Tool.Later in the American session, investors will pay close attention to the outcome of the 10-year US Treasury note auction. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
16:06 EUR/USD climbs above 1.1450 after US inflation data
EUR/USD gained traction and advanced toward 1.1500 in the early American session on Wednesday. The pair was last seen trading at 1.1465, rising 0.35% on a daily basis.
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.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}EUR/USD trades in positive territory above 1.1450 in the early American session.Annual CPI inflation in the US rose to 2.4% in May.The US Dollar struggles to stay resilient against its rivals.EUR/USD gained traction and advanced toward 1.1500 in the early American session on Wednesday. The pair was last seen trading at 1.1465, rising 0.35% on a daily basis. Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.30% -0.11% -0.09% -0.02% 0.04% 0.16% -0.24% EUR 0.30% 0.18% 0.20% 0.25% 0.32% 0.40% 0.04% GBP 0.11% -0.18% 0.02% 0.11% 0.16% 0.23% -0.15% JPY 0.09% -0.20% -0.02% -0.04% 0.14% 0.22% -0.18% CAD 0.02% -0.25% -0.11% 0.04% 0.09% 0.15% -0.25% AUD -0.04% -0.32% -0.16% -0.14% -0.09% 0.08% -0.29% NZD -0.16% -0.40% -0.23% -0.22% -0.15% -0.08% -0.38% CHF 0.24% -0.04% 0.15% 0.18% 0.25% 0.29% 0.38% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
USD weakens after softer-than-expected inflation dataThe US Dollar (USD) weakened against its rivals with the immediate reaction to May inflation data from the US and helped EUR/USD push higher midweek.The US Bureau of Labor Statistics reported that the Consumer Price Index (CPI) and the core CPI both rose 0.1% in May, at a softer pace than analysts' estimates. On a yearly basis, the CPI rose 2.4% following the 2.3% increase recorded in April and this figure came in below the market expectation of 2.5%. In this period, the core CPI increased 2.8% to match the April print. Reflecting the negative impact of inflation data, the US Dollar Index loses about 0.3% on the day below 99.00.Meanwhile, US President Donald Trump shared some details regarding the US-China trade agreement. This development, however, failed to help the USD gather strength."Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!)," Trump said on Truth Social. "We are getting a total of 55% tariffs, China is getting 10%. Relationship is excellent!"The economic calendar will not feature any other high-impact data releases on Wednesday. Nevertheless, the outcome of the 10-year Treasury note auction could impact the USD's valuation later in the American session. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
15:31 United States Consumer Price Index Core s.a climbed from previous 326.43 to 326.85 in May
United States Consumer Price Index Core s.a climbed from previous 326.43 to 326.85 in May
15:30 United States Consumer Price Index ex Food & Energy (YoY) below forecasts (2.9%) in May: Actual (2.8%)
United States Consumer Price Index ex Food & Energy (YoY) below forecasts (2.9%) in May: Actual (2.8%)
15:30 United States Consumer Price Index n.s.a (MoM) increased to 321.465 in May from previous 320.795
United States Consumer Price Index n.s.a (MoM) increased to 321.465 in May from previous 320.795
15:30 Canada Building Permits (MoM) below forecasts (2.2%) in April: Actual (-6.6%)
Canada Building Permits (MoM) below forecasts (2.2%) in April: Actual (-6.6%)
15:30 United States Consumer Price Index (YoY) came in at 2.4%, below expectations (2.5%) in May
United States Consumer Price Index (YoY) came in at 2.4%, below expectations (2.5%) in May
15:30 United States Consumer Price Index ex Food & Energy (MoM) came in at 0.1%, below expectations (0.3%) in May
United States Consumer Price Index ex Food & Energy (MoM) came in at 0.1%, below expectations (0.3%) in May
15:30 United States Consumer Price Index (MoM) below expectations (0.2%) in May: Actual (0.1%)
United States Consumer Price Index (MoM) below expectations (0.2%) in May: Actual (0.1%)
15:15 US Pres. Trump: Our deal with China is done, subject to final approval
In a post published on Truth Social on Wednesday, United States (US) President Donald Trump said that the trade deal with China is done and added that it is subject to his and Chinese President Xi Jinping's final approval.
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In a post published on Truth Social on Wednesday, United States (US) President Donald Trump said that the trade deal with China is done and added that it is subject to his and Chinese President Xi Jinping's final approval."Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me!)," Trump said and added:"We are getting a total of 55% tariffs, China is getting 10%. Relationship is excellent! Thank you for your attention to this matter!"Market reactionThe US Dollar (USD) Index showed no reaction to this headline and was last seen moving sideways slightly above 99.00. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
15:09 CAD soft and trading somewhat defensively despite higher oil prices – Scotiabank
The Canadian Dollar (CAD) is entering Wednesday’s NA session with a marginal decline vs. the US Dollar (USD) as it trades somewhat defensively from Tuesday’s close, Scotiabank's Chief FX Strategist Shaun Osborne notes.
The Canadian Dollar (CAD) is entering Wednesday’s NA session with a marginal decline vs. the US Dollar (USD) as it trades somewhat defensively from Tuesday’s close, Scotiabank's Chief FX Strategist Shaun Osborne notes. Fair value estimate for USD/CAD is currently at 1.3746"Movement remains limited overall and risk lies with the US CPI release at 8:30am ET. Canada will also be releasing domestic building permits at the same time, however the data are not expected to be as market-moving." "The CAD’s broader outlook remains constructive, owing to the recovery in oil prices and narrowing spreads as market participants respond to the latest shift in the outlook for relative central bank policy—and specifically the BoC’s shift toward a reluctantly neutral stance. Our FV estimate for USD/CAD is currently at 1.3746, leaving spot somewhat stretched vs. its fundamentals." "Technicals are bearish as USD/CAD continues its retracement of the September-February rally. Momentum indicators are bearish and the RSI’s current reading of 36 leaves ample room for further downside ahead of the oversold threshold at 30. There are no major retracement levels ahead of the September low at 1.3420. We look to near-term support between 1.3650 and 1.3620 and anticipate resistance in the 1.3720 to 1.3750 area."
15:05 USD: All eyes on US CPI – Scotiabank
Markets are quiet and shrugging off the successful conclusion of US/ China talks, eyeing the outcome with a certain degree of skepticism.
Markets are quiet and shrugging off the successful conclusion of US/ China talks, eyeing the outcome with a certain degree of skepticism. The negotiations have produced a framework for implementing the details of an agreement that had been previously agreed in May, Scotiabank's Chief FX Strategist Shaun Osborne notes. USD quiet overall with considerable risk in 8:30am ET CPI release"Currencies remain quiet for the most part, with MXN outperforming on shifting expectations for Banxico’s outlook and its move toward a less dovish stance. Meanwhile, AUD and NZD are underperforming with modest declines, holding on to losses resulting from early Asian session headlines related to trade and news that the US Court of Appeals had ruled in favor of the US administration’s tariffs. All of the remaining G10 currencies have recovered their trade headline-driven losses and are entering Wednesday’s NA session relatively unchanged vs. the USD." "The broader market’s tone is also quiet, as US equity futures consolidate just below Tuesday’s fresh local highs while the US 10Y appears to be finding modest support with a gentle recovery toward 4.50%. Oil prices remain well supported, climbing above $65/bbl and threatening an extension of their recovery from the April/May lows. Copper prices are weak, rolling over following signs of exhaustion (last Thursday’s shooting star doji) and an impressive rally from early May. Finally, gold is offering little in terms of direction at the moment, extending its tight consolidation for a third consecutive session as it trades around the mid-point of the flat range that has defined its price action since it reached its record high in late April.""The focus for Wednesday’s NA session will center on the 8:30am ET release of US CPI with expectations of a modest increase in both headline and core. The broader narrative around inflation has been one of persistent underlying pressures, most importantly in core. This has forced a shift in tone at the BoC, ECB, and now Banxico and could generate a sizeable (bullish) USD reaction if the release were to surprise to the upside. The response could be short-lived however, as the 2pm ET release of the US Federal Budget Balance will likely sharpen the market’s focus on the USD’s longer-term issues. Fedspeak remains limited in the blackout period ahead of next week’s meeting."
15:00 Mexico Industrial Output (YoY) down to -4% in April from previous 1.9%
Mexico Industrial Output (YoY) down to -4% in April from previous 1.9%
14:59 Gold edges higher ahead of US CPI inflation
Gold (XAU/USD) is trading higher during the European session on Wednesday as investors adopt a cautious stance ahead of key US inflation data. The precious metal gains modest ground, hovering above $3,330 at the time of writing.
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Gold (XAU/USD) is trading higher during the European session on Wednesday as investors adopt a cautious stance ahead of key US inflation data. The precious metal gains modest ground, hovering above $3,330 at the time of writing. Market participants are closely watching the upcoming May US Consumer Price Index (CPI) release on Wednesday, which is expected to provide critical insight into inflation dynamics and Federal Reserve (Fed) monetary policy.Consensus forecasts suggest that US headline inflation accelerated to an annual rate of 2.5% in May, up from the 2.3% increase seen in April. During the same period, core CPI inflation, which excludes the volatile food and energy prices, is expected to tick up to 2.9% from 2.8%.Rising inflation and the prospect of higher interest rates by the Fed typically support the US Dollar (USD), weighing on non-yielding assets like Gold.Gold daily digest market movers: XAU/USD driven by US-China trade deal and US CPI data The US and China reach a trade deal that includes the removal of China’s export restrictions on rare earths, which is likely to offer some relief for the US supply chain. These minerals are crucial for sectors such as technology, defense and green energy, where they are essential for products like semiconductors, electric vehicles (EVs) and military hardware.High-level negotiations between the two countries in London resulted in a provisional framework agreement, which now awaits a formal signature from US President Donald Trump and Chinese President Xi Jinping. On the other hand, Trump received a favorable development on Tuesday after a federal appeals court ruled that his “Liberation Day” tariffs can remain in effect, for now. The decision temporarily overturns a lower court ruling from last month, in which the US Court of International Trade blocked the levies, citing procedural violations in how they were enacted.Regarding US inflation data, the CPI and the core CPI are projected to rise by 0.2% and 0.3%, respectively, on a monthly basis.On Thursday, the US will release the US Producer Price Index (PPI) data for May, which is expected also to show an increase in headline inflation from a producer level.These figures are likely to influence market expectations regarding the Fed policy path. The Fed left the federal funds rate unchanged at the 4.25%–4.50 % range at its May meeting, but policymakers have signaled that their decisions remain data-dependent.According to the CME FedWatch Tool, market participants expect the Fed to keep interest rates unchanged at the June and July meetings, with a 52.2% probability of an interest rate cut priced in for September.Gold technical analysis: XAU/USD flirts with $3,300 - Is a potential breakout near?Gold price is currently holding above the $3,300 mark, hovering around $3,330 at the time of writing, as the market finds short-term support in this range. On the upside, resistance is forming near the psychological level of $3,350, and a break above this barrier could pave the way for a move toward Friday’s high of around $3,375. Further up, the $3,400 psychological level limited the bullish potential last week. If buyers clear this zone and bullish momentum gains traction, a move toward the April all-time high at $3,500 may be possible.
However, the Relative Strength Index (RSI) indicator flattens near the neutral zone of 50 on the daily chart, signalling a lack of momentum and indecision among traders.In the event of a downside move, the immediate support for the Gold price is at the 20-day Simple Moving Average (SMA) at $3,310, just above the next psychological support zone of the $3,300 mark, and ahead of the 23.6% Fibonacci retracement level of the January-April rise at $3,291.Further down, the 50-day SMA could then provide an additional layer of support around $3,275, while the tip of a symmetrical triangle chart pattern could provide another important cushion for downside price action at $3,240. Economic Indicator Consumer Price Index (YoY) Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish. Read more. Next release: Wed Jun 11, 2025 12:30 Frequency: Monthly Consensus: 2.5% Previous: 2.3% Source: US Bureau of Labor Statistics Why it matters to traders? The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
However, the Relative Strength Index (RSI) indicator flattens near the neutral zone of 50 on the daily chart, signalling a lack of momentum and indecision among traders.In the event of a downside move, the immediate support for the Gold price is at the 20-day Simple Moving Average (SMA) at $3,310, just above the next psychological support zone of the $3,300 mark, and ahead of the 23.6% Fibonacci retracement level of the January-April rise at $3,291.Further down, the 50-day SMA could then provide an additional layer of support around $3,275, while the tip of a symmetrical triangle chart pattern could provide another important cushion for downside price action at $3,240. Economic Indicator Consumer Price Index (YoY) Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish. Read more. Next release: Wed Jun 11, 2025 12:30 Frequency: Monthly Consensus: 2.5% Previous: 2.3% Source: US Bureau of Labor Statistics Why it matters to traders? The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
14:59 Platinum price rises to 4-year high – Commerzbank
The price of Platinum continued to soar at the start of the new trading week and broke through the $1,200 per troy ounce mark for the first time in four years on Monday, Commerzbank's commodity analyst Carsten Fritsch notes.
The price of Platinum continued to soar at the start of the new trading week and broke through the $1,200 per troy ounce mark for the first time in four years on Monday, Commerzbank's commodity analyst Carsten Fritsch notes. Platinum price continues to soar"The price is currently trading even higher at around $1,270. The Platinum price is up 27% since 20 May and 40% since the beginning of the year. This means that the Platinum price has risen even more than the gold price, which has ‘only’ risen by 27% since the beginning of the year." "At the beginning of April, shortly after the announcement of reciprocal tariffs by US President Trump, Platinum briefly fell back to $900. The price explosion came largely as a surprise. The physical Platinum market has been tight for years without the price being able to benefit from this, apart from brief price spikes that never lasted long."
14:55 EUR up marginally vs. USD – Scotiabank
The Euro (EUR) is up marginally vs. the US Dollar (USD), trading toward the mid-1.14s on the back of the broader market’s muted reaction to the US/China talks.
The Euro (EUR) is up marginally vs. the US Dollar (USD), trading toward the mid-1.14s on the back of the broader market’s muted reaction to the US/China talks. Markets digest ECB headlines in absence of fundamental data"There have been no major releases, offering little in terms of fundamentally-driven price action. The ECB however, continues to deliver a steady barrage of headline risk that continues to underscore a shift toward neutral." "Policymakers are also attempting to champion the global role of the euro in a world of trade-related uncertainty. Near-term risks may be tilted to the downside, as we note a small pull back in risk reversals, revealing a shift in sentiment and a repricing of options fading the premium of calls over puts."
14:52 Chinese crude Oil imports fell to 4-month low in May – Commerzbank
The Chinese customs authority published data on crude Oil imports in May at the start of the week. Imports fell to a 4-month low of 46.6 million tons or 11 million barrels per day last month. In the previous month, they had still totalled 11.7 million barrels per day.
The Chinese customs authority published data on crude Oil imports in May at the start of the week. Imports fell to a 4-month low of 46.6 million tons or 11 million barrels per day last month. In the previous month, they had still totalled 11.7 million barrels per day. The decline comes as no surprise, as we noted last Friday with regard to the significant drop in crude Oil processing in April. According to the Chinese consultancy Oilchem, 2.6 million barrels of daily processing capacity were shut in May due to maintenance work. According to the consultancy Kpler, refineries have therefore reduced their Oil supplies for May, Commerzbank's commodity analyst Carsten Fritsch notes. Need to import crude Oil may also remain subdued"In addition, Oil prices rose noticeably over the course of the month following a brief decline at the beginning of May, which is likely to have dampened buying interest. China's weaker import demand was also reflected in a significant reduction in official selling prices for Oil shipments in May by Saudi Arabia. Due to tighter US sanctions, independent refineries are also likely to have refrained from importing Iranian Oil, even if there is no official data on this from China. According to data from Bloomberg, Iran's Oil exports to China fell below the 1 million barrels per day mark for the first time in six months in May.""At the same time, China also exported fewer Oil products in May. Exports amounted to 4.41 million tons. In the previous month, the figure was just over 5 million tons. In the previous year, it was almost 1 million tons higher. The last time exports of Oil products were at a lower level was in February. The customs authority will only publish detailed figures on specific Oil products at a later date. The lower exports are likely to be primarily due to reduced crude Oil processing." "However, they may also indicate weaker demand in neighbouring Asian countries, which is making it more difficult for Chinese refineries to export excess Oil products. This would speak in favour of subdued processing margins in China and restrained crude Oil processing, even if the maintenance work has been completed. As a result, the need to import crude Oil would also remain subdued, which would weigh on Oil prices."
14:46 NZD/USD retreats to 0.6030 lows with investors bracing for US CPI data
The New Zealand Dollar is trading about 0.35% lower on Wednesday, with investors slightly disappointed by the lack of news of the US-China trade deal, while a soft US Dollar, ahead of the US CPI release, is keeping the Kiwi from dropping further.US Commerce Secretary Howard Lutnick celebrated the ag
.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}The New Zealand Dollar retreated as the US-China deal failed to convince investors.The US Dollar is showing minor gains ahead of the US CPI releaseNZD/USD is showing signs, suggesting a potential trend shift.The New Zealand Dollar is trading about 0.35% lower on Wednesday, with investors slightly disappointed by the lack of news of the US-China trade deal, while a soft US Dollar, ahead of the US CPI release, is keeping the Kiwi from dropping further.
US Commerce Secretary Howard Lutnick celebrated the agreement of a “framework” that will allow for lower tariffs and ease restrictions on rare earths trade. Investors’ reaction, however, has been less than enthusiastic amid doubts about the lack of details of the deal and concerns about its durability.
The US Dollar appreciated following news about the deal, but most of the gains were lost shortly afterwards. Investors remain wary that the US CPI report might confirm the inflationary impact of Trump’s “Liberation Day” tariffs and boost fears of stagflation.NZD is forming an “Evening Star” candle formation
The Daily chart shows an “Evening Star” candle pattern and a potential double top at 0.6080, both negative signs that could be anticipating a bearish correction after the May-June rally.
The pair is now approaching the ascending trendline support from May 23 lows, at 0.6025, ahead of the neckline of the mentioned DT, at 0.6000. Further decline below these levels would confirm a trend shift and increase pressure towards the 5925 area, where the 61.8% Fibonacci retracement meets May 28 and 29 lows.
On the upside, a break of the mentioned 0.6080 cancels this view and clears the path towards mid-October 2024 highs, at 0.6120. New Zealand Dollar PRICE Today The table below shows the percentage change of New Zealand Dollar (NZD) against listed major currencies today. New Zealand Dollar was the strongest against the Australian Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.03% 0.05% 0.25% 0.08% 0.26% 0.45% -0.00% EUR 0.03% 0.07% 0.27% 0.10% 0.28% 0.43% 0.02% GBP -0.05% -0.07% 0.18% 0.06% 0.23% 0.37% -0.06% JPY -0.25% -0.27% -0.18% -0.27% 0.02% 0.18% -0.28% CAD -0.08% -0.10% -0.06% 0.27% 0.21% 0.34% -0.11% AUD -0.26% -0.28% -0.23% -0.02% -0.21% 0.15% -0.27% NZD -0.45% -0.43% -0.37% -0.18% -0.34% -0.15% -0.43% CHF 0.00% -0.02% 0.06% 0.28% 0.11% 0.27% 0.43% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the New Zealand Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent NZD (base)/USD (quote).
US Commerce Secretary Howard Lutnick celebrated the agreement of a “framework” that will allow for lower tariffs and ease restrictions on rare earths trade. Investors’ reaction, however, has been less than enthusiastic amid doubts about the lack of details of the deal and concerns about its durability.
The US Dollar appreciated following news about the deal, but most of the gains were lost shortly afterwards. Investors remain wary that the US CPI report might confirm the inflationary impact of Trump’s “Liberation Day” tariffs and boost fears of stagflation.NZD is forming an “Evening Star” candle formation
The Daily chart shows an “Evening Star” candle pattern and a potential double top at 0.6080, both negative signs that could be anticipating a bearish correction after the May-June rally.
The pair is now approaching the ascending trendline support from May 23 lows, at 0.6025, ahead of the neckline of the mentioned DT, at 0.6000. Further decline below these levels would confirm a trend shift and increase pressure towards the 5925 area, where the 61.8% Fibonacci retracement meets May 28 and 29 lows.
On the upside, a break of the mentioned 0.6080 cancels this view and clears the path towards mid-October 2024 highs, at 0.6120. New Zealand Dollar PRICE Today The table below shows the percentage change of New Zealand Dollar (NZD) against listed major currencies today. New Zealand Dollar was the strongest against the Australian Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.03% 0.05% 0.25% 0.08% 0.26% 0.45% -0.00% EUR 0.03% 0.07% 0.27% 0.10% 0.28% 0.43% 0.02% GBP -0.05% -0.07% 0.18% 0.06% 0.23% 0.37% -0.06% JPY -0.25% -0.27% -0.18% -0.27% 0.02% 0.18% -0.28% CAD -0.08% -0.10% -0.06% 0.27% 0.21% 0.34% -0.11% AUD -0.26% -0.28% -0.23% -0.02% -0.21% 0.15% -0.27% NZD -0.45% -0.43% -0.37% -0.18% -0.34% -0.15% -0.43% CHF 0.00% -0.02% 0.06% 0.28% 0.11% 0.27% 0.43% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the New Zealand Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent NZD (base)/USD (quote).
14:28 USD/CAD wobbles below 1.3700 as US inflation takes centre stage
The USD/CAD trades in a tight range below 1.3700 during European trading hours on Wednesday. The Loonie pair consolidates as investors await the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.
.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}USD/CAD trades sideways below 1.3700 ahead of the US inflation data for May.The US CPI data will influence market expectations for the Fed’s monetary policy outlook.Lower Oil price weigh on the Canadian Dollar.The USD/CAD trades in a tight range below 1.3700 during European trading hours on Wednesday. The Loonie pair consolidates as investors await the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.Economists expect the US headline inflation to have accelerated to 2.5% from 2.3% in April. The core CPI – which excludes volatile foods and energy prices – is expected to have grown at a faster pace of 2.9%, compared to the prior reading of 2.8%.CPI expectations indicate that the tariff policy imposed by US President Donald Trump has started feeding into the economy. The scenario of accelerating inflationary pressures will encourage Federal Reserve (Fed) officials to commit to holding onto their stance that monetary policy adjustments are not appropriate unless they scrutinize the likely consequences of new economic policies imposed by Trump.Ahead of the US inflation data, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades flat around 99.00.Meanwhile, the Canadian Dollar (CAD) ticks down as market experts see the Oil price falling amid demand concerns. The US Energy Information Administration (EIA) anticipated a decline in international benchmark Brent crude to $61/bbl by end-2025, citing demand concerns and rising output.Given that Canada is the leading exporter of Oil to the US, lower energy prices weigh on the Loonie. US Dollar FAQs What is the US Dollar? The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022.
Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away. How do the decisions of the Federal Reserve impact the US Dollar? The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates.
When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback. What is Quantitative Easing and how does it influence the US Dollar? In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system.
It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar. What is Quantitative Tightening and how does it influence the US Dollar? Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.
14:27 GBP: The British Chancellor of the Exchequer's concerns are likely to grow further – Commerzbank
Yesterday's British labour market data reinforced the concerns of those backing the United Kingdom. The unemployment rate rose as expected, wage growth slowed unexpectedly, and the number of people in employment fell by around 109,000.
Yesterday's British labour market data reinforced the concerns of those backing the United Kingdom. The unemployment rate rose as expected, wage growth slowed unexpectedly, and the number of people in employment fell by around 109,000. The latter figure attracted particular attention because it was the largest decline since the pandemic peak and because job creation has virtually collapsed since the British Chancellor's budget announcement in October, which was followed by an increase in social security contributions for companies, Commerzbank's FX analyst Michael Pfister notes. UK labour market weakens, casting doubt on economic resilience"At this point, however, it is important to put things into perspective. Job creation figures are often significantly revised in retrospect (for example, the figure initially published in April 2023 was similarly low, but was later revised significantly upwards). Labour market data should also be treated with caution given the problems with the survey, and a slowdown was to be expected given the restrictive monetary policy.""Despite these arguments, yesterday's data showed that the UK's real economy is not as stable as the strong growth figures for the first quarter suggested. This is a challenging situation for the Chancellor of the Exchequer, who must present her first spending review today. Further difficult decisions regarding savings and higher revenues will probably have to be made, which are likely to exacerbate the difficult economic situation in the coming months.""Therefore, it should come as no surprise that the market is now pricing in significantly more interest rate cuts by the Bank of England this year than at the beginning of the year. As we have emphasised several times, the path towards a stronger pound remains narrow, even if we do not want to overinterpret a single data release."
14:09 The night brings white smoke over London – Commerzbank
An agreement was finally reached in the trade talks between China and the US in London in the middle of the night. As expected, the foreign exchange market did not react strongly to the news, Commerzbank's FX analyst Michael Pfister notes.
An agreement was finally reached in the trade talks between China and the US in London in the middle of the night. As expected, the foreign exchange market did not react strongly to the news, Commerzbank's FX analyst Michael Pfister notes. US-China trade deal reached, markets remain unmoved"Firstly, as is often the case, the details are lacking, and the announcement merely clarified that the agreement reached in Geneva just four weeks ago will now be implemented more effectively. This means that no new improvements were achieved in the talks; only the tensions that have arisen since the last agreement have been defused.""Secondly, this does not mean that tensions will not rise again in a few days. US trade policy is so erratic that no market participant can predict whether a far-reaching deal with China will prove more difficult to achieve than expected, including new tariff threats, in a few days' time.""Given these prospects, I can understand why any market participant would break out in jubilation after the announcement and trade the US dollar significantly stronger."
14:05 USD/INR Price Forecast: The support area at 85.25 is coming into focus
The Indian Rupee is trading higher for the fifth consecutive day on Wednesday.
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US and China agreed on a framework to de-escalate their trade rift and return to the Geneva meeting consensus, that is, fewer restrictions for rare earths’ trade and lower tariffs. The lack of details about the agreement, however, has triggered a sceptical market reaction.
The Dollar ticked up after the news before losing ground during the US Session, with investors cautious ahead of the release of US CPI data and a key auction of US Treasury bonds due later today.Technical analysis: USD/INR bears remain in controlThe USD/INR keeps correcting lower from the 86.00 peak hit last week, likely to extend losses towards the key 85.25-85.35 area, where the lows of May 28 and 30 and June 2 meet the ascending trendline support from early May lows.
The pair is moving in an ascending triangle pattern, which is a bullish formation, but technical indicators are pointing lower, and the confirmation below the mentioned levels would increase negative pressure towards 84.77 (May 26 and 27 lows), ahead of the 12 May low, at 84.25.
On the upside, a break above $86.00 to mark a trend shift and set its focus towards the April 9 high, at 86.90. USD/INR 4-Hour Chart Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
US and China agreed on a framework to de-escalate their trade rift and return to the Geneva meeting consensus, that is, fewer restrictions for rare earths’ trade and lower tariffs. The lack of details about the agreement, however, has triggered a sceptical market reaction.
The Dollar ticked up after the news before losing ground during the US Session, with investors cautious ahead of the release of US CPI data and a key auction of US Treasury bonds due later today.Technical analysis: USD/INR bears remain in controlThe USD/INR keeps correcting lower from the 86.00 peak hit last week, likely to extend losses towards the key 85.25-85.35 area, where the lows of May 28 and 30 and June 2 meet the ascending trendline support from early May lows.
The pair is moving in an ascending triangle pattern, which is a bullish formation, but technical indicators are pointing lower, and the confirmation below the mentioned levels would increase negative pressure towards 84.77 (May 26 and 27 lows), ahead of the 12 May low, at 84.25.
On the upside, a break above $86.00 to mark a trend shift and set its focus towards the April 9 high, at 86.90. USD/INR 4-Hour Chart Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
14:00 United States MBA Mortgage Applications up to 12.5% in June 6 from previous -3.9%
United States MBA Mortgage Applications up to 12.5% in June 6 from previous -3.9%
13:49 EUR/JPY breaks out of multi-month range, eyes 168.40 target – Société Générale
EUR/JPY has broken above key technical resistance at 164.60, regaining upward momentum after months of consolidation.
EUR/JPY has broken above key technical resistance at 164.60, regaining upward momentum after months of consolidation. The pair now trades firmly above its 50-day moving average, with bullish MACD signaling further upside toward October 2024 highs and targets at 166.70–168.40, provided 164.60 holds as support, Société Générale's FX analysts note.EUR/JPY clears 164.60 resistance, MACD signals renewed upside"EUR/JPY has recently established itself above the 50-DMA and has now overcome the upper limit of the range within which it evolved since last December (164.60) highlighting regaining upward momentum. This is also denoted by the daily MACD, which remains anchored within positive territory.""The pair may head higher gradually towards October 2024 high and projections near 166.70/167.10 and 168.40. Defence of the upper band of previous range at 164.60 will be crucial for persistence in up move."
13:45 Three reasons why higher US inflation figures may not help the USD – Commerzbank
Today, the foreign exchange market is awaiting the week's key data: the US inflation figures for May.
Today, the foreign exchange market is awaiting the week's key data: the US inflation figures for May. Since the beginning of the pandemic, the reasoning has usually been straightforward: if inflation exceeds expectations, the Fed is expected to respond by raising interest rates, which has historically benefited the US Dollar (USD), Commerzbank's FX analyst Michael Pfister notes. USD faces crucial test as US inflation data looms"There is no guarantee that rising inflation risks will lead to a stronger USD. Using data from 2002 onwards, the lower charts show virtually no relationship. It may be that the relationship between rising inflation risks and a stronger USD only becomes apparent during periods when the Fed makes changes to its monetary policy, i.e. when it raises interest rates or delays cuts. However, it is also possible that inflation simply did not play such a significant role in the years leading up to the pandemic. In the 2010s, central banks tended to struggle with low inflation, meaning that it did not have as big an impact on the USD as it has recently.""The USD can no longer benefit from rising inflation expectations, arguing that a temporary inflation shock would reduce the purchasing power of the USD, but would not necessarily prompt a response from the Fed. This could be an explanation as to why higher inflation could lead to a weaker USD. Ultimately, the risks to the market have shifted in recent weeks. It is not only the Fed that has recently warned that the risks to its two mandates are now more balanced. Following 'Liberation Day' and the announcement of unexpectedly high tariffs, the market also became increasingly concerned. This was less about the impact on inflation and more about the real economy. In such an environment, it is more difficult to link higher inflation to a stronger USD.""Admittedly, these are medium-term arguments. Back to today's figures, our economists still assume that the tariffs did not have a noticeable impact on prices in May. However, this does not mean that this will also be the case in the coming months. These effects are taking longer to materialise than some had expected. This could convince some market participants that the recent stagflation concerns were exaggerated, which would support the USD. Nevertheless, I would not bet on this remaining the case."
13:36 ECB's Lane: Last week's cut guards against any uncertainty about our reaction function
European Central Bank (ECB) Chief Economist Philip Lane said on Wednesday that the rate cut announced last week will guard them against any uncertainty about their reaction functions.
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European Central Bank (ECB) Chief Economist Philip Lane said on Wednesday that the rate cut announced last week will guard them against any uncertainty about their reaction functions."This cut helps ensure that the projected negative inflation deviation over the next eighteen months remains temporary and does not convert into a longer-term deviation of inflation from the target," Lane explained, per Reuters.Market reactionThese comments failed to trigger a noticeable reaction in EUR/USD. At the time of press, the pair was trading marginally higher on the day at 1.1435. ECB FAQs What is the ECB and how does it influence the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy for the region.
The ECB primary mandate is to maintain price stability, which means keeping inflation at around 2%. Its primary tool for achieving this is by raising or lowering interest rates. Relatively high interest rates will usually result in a stronger Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. What is Quantitative Easing (QE) and how does it affect the Euro? In extreme situations, the European Central Bank can enact a policy tool called Quantitative Easing. QE is the process by which the ECB prints Euros and uses them to buy assets – usually government or corporate bonds – from banks and other financial institutions. QE usually results in a weaker Euro.
QE is a last resort when simply lowering interest rates is unlikely to achieve the objective of price stability. The ECB used it during the Great Financial Crisis in 2009-11, in 2015 when inflation remained stubbornly low, as well as during the covid pandemic. What is Quantitative tightening (QT) and how does it affect the Euro? Quantitative tightening (QT) is the reverse of QE. It is undertaken after QE when an economic recovery is underway and inflation starts rising. Whilst in QE the European Central Bank (ECB) purchases government and corporate bonds from financial institutions to provide them with liquidity, in QT the ECB stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive (or bullish) for the Euro.
13:14 USD/JPY trades broadly calm near 145.00 ahead of US inflation data for May
The USD/JPY pair trades calmly around 145.00 during European trading hours on Wednesday. The pair oscillates in a tight range, with investors awaiting the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.
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The pair oscillates in a tight range, with investors awaiting the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.Ahead of the US inflation data, the US Dollar Index (DXY) wobbles around 99.00.Investors will pay close attention to the US inflation data as it will influence market expectations for the Federal Reserve’s (Fed) monetary policy outlook. As measured by the CPI, the headline inflation is estimated to have grown at a faster pace of 2.5% on year, compared to 2.3% in April. Year-on-year core CPI is also expected to have accelerated to 2.9% from the prior reading of 2.8%.The inflation will indicate whether new economic policies announced by US President Donald Trump are prompting price pressures, assuming that the impact of higher tariffs imposed by Washington will be borne by domestic importers who will pass on the effect to households.Meanwhile, trade tensions between the US and China appears to have de-escalated after a two-day meeting in London. US Secretary of Commerce Howard Lutnick has expressed confidence after the meeting that China would reverse export restrictions on “rare earths”.On the Tokyo front, investors doubt whether the Bank of Japan (BoJ) will raise interest rates again this year. A Reuters poll in the June 2-10 period showed that a slight majority of economists expect the BoJ to keep interest rates steady at 0.5% by the year-end and will raise them in early 2026. Economic Indicator Consumer Price Index (YoY) Inflationary or deflationary tendencies are measured by periodically summing the prices of a basket of representative goods and services and presenting the data as The Consumer Price Index (CPI). CPI data is compiled on a monthly basis and released by the US Department of Labor Statistics. The YoY reading compares the prices of goods in the reference month to the same month a year earlier.The CPI is a key indicator to measure inflation and changes in purchasing trends. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish. Read more. Next release: Wed Jun 11, 2025 12:30 Frequency: Monthly Consensus: 2.5% Previous: 2.3% Source: US Bureau of Labor Statistics Why it matters to traders? The US Federal Reserve (Fed) has a dual mandate of maintaining price stability and maximum employment. According to such mandate, inflation should be at around 2% YoY and has become the weakest pillar of the central bank’s directive ever since the world suffered a pandemic, which extends to these days. Price pressures keep rising amid supply-chain issues and bottlenecks, with the Consumer Price Index (CPI) hanging at multi-decade highs. The Fed has already taken measures to tame inflation and is expected to maintain an aggressive stance in the foreseeable future.
13:12 Gold Price Forecast: XAU/USD resistance at $3,345 is holding bulls for now
Gold (XAU/USD) is trading higher on Wednesday following some hesitation on Tuesday.
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Gold (XAU/USD) is trading higher on Wednesday following some hesitation on Tuesday. The sceptical market reaction to the US-China trade deal and investors’ cautious mood ahead of the US CPI release are supporting the precious metal, which, nevertheless, is struggling to extend gains past the $3,345 area.
The US and China agreed on a “framework” for a deal to de-escalate their trade tensions and return to the last month's Geneva consensus. The scarce details of the deal, however, have raised speculation about its durability, which explains the tepid market reaction to the news.
The focus now is on the US Consumer Prices Index data, due later today, that might confirm the inflationary impact of Trump’s tariffs. The risk is on an upside surprise that might bring deflation fears back to the table and increase bearish pressure on the USD.Technical analysis: XAU/USD remains in a bearish correction from $3,400From a technical standpoint, the pair is consolidating losses following a bearish correction from $3,400 last week. Price action is showing “inside days” within Friday’s trading limits, with the 4-Hour RSI flat near the 50 level.
An Elliott Wave analysis would suggest that we are on an A-B-C correction, following the completion of a bullish cycle last week. The current upward leg (A-B leg) might extend beyond the mentioned $3,345 resistance to test the reverse trendline, now at $3,375, before extending lower.
On the downside, supports are at the June 9 low, $3,290, and the May 15 and 19 highs, and May 29 lows at $3,245.XAU/USD 4-Hour Chart Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
Gold (XAU/USD) is trading higher on Wednesday following some hesitation on Tuesday. The sceptical market reaction to the US-China trade deal and investors’ cautious mood ahead of the US CPI release are supporting the precious metal, which, nevertheless, is struggling to extend gains past the $3,345 area.
The US and China agreed on a “framework” for a deal to de-escalate their trade tensions and return to the last month's Geneva consensus. The scarce details of the deal, however, have raised speculation about its durability, which explains the tepid market reaction to the news.
The focus now is on the US Consumer Prices Index data, due later today, that might confirm the inflationary impact of Trump’s tariffs. The risk is on an upside surprise that might bring deflation fears back to the table and increase bearish pressure on the USD.Technical analysis: XAU/USD remains in a bearish correction from $3,400From a technical standpoint, the pair is consolidating losses following a bearish correction from $3,400 last week. Price action is showing “inside days” within Friday’s trading limits, with the 4-Hour RSI flat near the 50 level.
An Elliott Wave analysis would suggest that we are on an A-B-C correction, following the completion of a bullish cycle last week. The current upward leg (A-B leg) might extend beyond the mentioned $3,345 resistance to test the reverse trendline, now at $3,375, before extending lower.
On the downside, supports are at the June 9 low, $3,290, and the May 15 and 19 highs, and May 29 lows at $3,245.XAU/USD 4-Hour Chart Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
12:57 USD/CNH: Expected to trade in a range of 7.1730/7.1970 – UOB Group
US Dollar (USD) is expected to trade in a range of 7.1730/7.1970 against Chinese Yuan (CNH). In the longer run, USD has likely moved into a 7.1620/7.2200 range trading phase, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
US Dollar (USD) is expected to trade in a range of 7.1730/7.1970 against Chinese Yuan (CNH). In the longer run, USD has likely moved into a 7.1620/7.2200 range trading phase, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. USD has likely moved into a range trading phase24-HOUR VIEW: "Following the quiet price action in USD on Monday, we indicated yesterday, Tuesday, that “the price action provides no fresh clues, and USD is likely to trade in a range of 7.1700/7.1900 today.” USD then traded between 7.1780 and 7.1941, closing little changed at 7.1889 (-0.04%). The price action still provides no fresh clues. Today, we expect USD to trade in a range of 7.1730/7.1970." 1-3 WEEKS VIEW: "There is not much to add to our update from Monday (09 Jun, spot at 7.1870). As highlighted, the recent 'mild downward momentum has eased, and USD has likely moved back into a range trading phase, probably between 7.1620 and 7.2200.”
12:57 Japan: BoJ to pause hike in June, continue QT – Standard Chartered
Bank of Japan (BoJ) will hike by 25bps in Q4 on concerns over growth momentum. USD/JPY’s failure to break below 142 on multiple occasions since May raises the risk of a short squeeze. The BoJ to continue with QT at JPY 400bn per quarter from April 2026.
Bank of Japan (BoJ) will hike by 25bps in Q4 on concerns over growth momentum. USD/JPY’s failure to break below 142 on multiple occasions since May raises the risk of a short squeeze. The BoJ to continue with QT at JPY 400bn per quarter from April 2026. Other permutations exist, such as staggering or slowing the pace of QT to between JPY 200-300bn, Standard Chartered's economists Chong Hoon Park and Nicholas Chia report. Tightening in one form or another"We now expect the BoJ to keep the policy rate at 0.50% on 17 June and hike by 25bps each in Q4-2025 (to 0.75%) and Q2-2026 (to 1.00%), versus our earlier call of 25bps rate hikes in June and Q4. Recent data underscores that the economy is not yet strong enough to absorb additional tightening. Household spending in April fell unexpectedly; real wages remain under pressure, and Q1 GDP contracted. These signs of softening domestic demand have been concurrent with inflation staying well above the central bank’s 2% target, raising questions about the sustainability of the domestic consumption momentum.""With consumption weakening and external headwinds intensifying, we now believe the BoJ will wait for clearer evidence that rising wages are translating into real spending. We expect the next rate hike in Q4, assuming improved visibility on domestic demand, wage pass-through, and the resolution of US trade policy uncertainty.""The failure of USD/JPY to break below 142 on multiple occasions since May raises the risk of a short squeeze in the pair. On quantitative tightening (QT), our baseline is for the BoJ to maintain the bond taper at JPY 400bn per quarter from April 2026, although other permutations exist, such as halving the pace of the bond taper to JPY 200bn. The tail risk is if the BoJ accelerates the pace of the bond taper. Politics may exert less of a drag on JGBs once the current Diet session ends on 22 June, in our view."
12:52 USD/JPY: Likely to trade in a higher trading range of 144.50/145.50 – UOB Group
Slight increase in upward momentum is likely to lead to a higher trading range of 144.50/145.50.
Slight increase in upward momentum is likely to lead to a higher trading range of 144.50/145.50. In the longer run, increase in momentum is not sufficient to indicate a sustained advance just yet; USD must first break and hold above 145.50, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. Increase in momentum is not sufficient to indicate a sustained advance24-HOUR VIEW: "We expected USD to 'consolidate in a range of 144.00/145.00' yesterday. However, USD traded in a higher range of 144.38/145.29. The price movements have resulted in a slight increase in upward momentum, but this is likely to lead to a higher trading range of 144.50/145.50 instead of a sustained advance. In other words, USD is unlikely to break clearly above 145.50." 1-3 WEEKS VIEW: "Last Wednesday (04 Jun, spot at 143.85), we stated that 'the recent price action suggests USD is still trading in a range, most likely between 142.10 and 145.50.' On Friday, USD soared to a high of 145.08. On Monday (09 Jun, spot at 144.70), we indicated that the increase in upward momentum is not sufficient to indicate a sustained advance just yet.' However, we pointed out that 'if USD were to break and hold above 145.50, it could potentially trigger a strong recovery.' We continue to hold the same view as long as the ‘strong support’ at 143.60 (level previously at 143.30) is not breached."
12:50 CAD: Broadly unattractive – ING
The Canadian Dollar (CAD) has been one of the best performers in the G10 over the past month, helped by some stronger-than-expected inflation and growth data that ultimately led to a Bank of Canada hold on 4 June, ING's FX analyst Francesco Pesole notes.
The Canadian Dollar (CAD) has been one of the best performers in the G10 over the past month, helped by some stronger-than-expected inflation and growth data that ultimately led to a Bank of Canada hold on 4 June, ING's FX analyst Francesco Pesole notes. USD/CAD may face periods of downward pressure"While USD/CAD may still face periods of downward pressure on the back of lacklustre USD demand, the loonie does not look attractive in other G10 crosses. The new US metal tariff hikes disproportionally hit Canadian exporters, and there are no indications of imminent high-level trade negotiations with the US." "Growth risks remain heavily tilted to the downside in Canada, and we believe the Bank of Canada will need to react, possibly by cutting rates as soon as July.""Markets are pricing in only 8bp for July, and 15bp for September, so we see scope for a dovish shift in the CAD curve that, when adding the risks of exposure to more potential deterioration in US sentiment, makes the loonie one of our least favourite currencies in G10 at the moment."
12:48 NZD/USD: Likely to trade with an upward bias – UOB Group
New Zealand Dollar (NZD) is likely to trade with an upward bias against US Dollar (USD); the major resistance at 0.6095 is likely out of reach.
New Zealand Dollar (NZD) is likely to trade with an upward bias against US Dollar (USD); the major resistance at 0.6095 is likely out of reach. In the longer run, upward momentum remains largely unchanged, but there is a chance for NZD to test 0.6095, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. Major resistance at 0.6095 is likely out of reach24-HOUR VIEW: "NZD rose to 0.6066 two days ago. Yesterday, we noted that “while there has been no significant increase in momentum, NZD may test the 0.6070 level before levelling off.” Our expectation did not materialise as NZD traded in a range of 0.6029/0.6059, closing little changed at 0.6054 (+0.07%). We continue to detect a firm underlying tone and expect NZD to trade with an upward bias today. That said, the major resistance at 0.6095 is likely out of reach (there is another resistance level at 0.6070). Support is at 0.6040 and 0.6030." 1-3 WEEKS VIEW: "We revised our NZD view to positive last Tuesday (03 Jun, spot at 0.6040), indicating that 'the rapid buildup in upward momentum indicates further NZD strength, and the level to monitor is 0.6095.' After NZD rose to 0.6088, we highlighted last Friday (06 Jun, spot at 0.6045) that upward momentum remains largely unchanged, but as long as 0.5985 (‘strong support’ level) is not breached, there is a chance for NZD to test 0.6095.' Yesterday, we revised the ‘strong support’ level to 0.6000. Today, the ‘strong support’ level has edged up to 0.6010."
12:45 USD: Inflation and 10-year auction in focus today – ING
This week hasn’t shown a clear direction for the dollar so far. Uncertainty around how far-reaching the US-China trade talks in London will be has left room for domestic factors to shape relative performance across G10 currencies.
This week hasn’t shown a clear direction for the dollar so far. Uncertainty around how far-reaching the US-China trade talks in London will be has left room for domestic factors to shape relative performance across G10 currencies. As of this morning, reports claim negotiators have agreed on a 'framework' to restart the flow of sensitive goods, including rare earths, pending sign-off from Trump and Xi. From a market sentiment standpoint, this feels like a positive step toward de-escalation, but not a major breakthrough. China’s refusal to commit to reducing its trade deficit still leaves plenty of ammo for trade hawks in Washington to resist any structural easing, ING's FX analyst Francesco Pesole notes. Bearish bias for the time being"Markets are treating the London summit with some scepticism. The dollar remains one of the best gauges of trade sentiment. While it has held up generally well early this week, it hasn’t built on the late-week momentum following the US-China meeting announcement. According to our short-term model, it’s still about 3-4% undervalued against major G10 peers. US equity futures point to a soft open this morning following modest gains yesterday.""Domestic fiscal developments have also weighed on the dollar. A soft 3-year Treasury auction reversed some recent gains in US government bonds, which now face a dual test today with the highly watched 10-year auction and CPI data. We expect May’s core inflation to come in at 0.2%, below the 0.3% consensus, which could ease pressure on Treasuries but might weigh on the dollar as chances of a September rate cut (now 50% priced in) fade. Later today, May’s Federal budget balance data will also be released.""Our bias is bearish on the dollar today – not just because of our core CPI call, but also amid reports that Treasury Secretary Scott Bessent is being considered as Powell’s Fed successor. The dollar strongly dislikes any threats to Fed independence. Add in that Bessent is likely to favour much lower rates (echoing Trump’s rhetoric), and the greenback faces mostly downside risks from this story."
12:42 AUD/USD: Major resistance at 0.6555 is likely out of reach – UOB Group
Increasing momentum suggests further upside pressure; the major resistance at 0.6555 is likely out of reach. In the longer run, bias remains on the upside, but it remains to be seen if AUD can break clearly above 0.6555, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
Increasing momentum suggests further upside pressure; the major resistance at 0.6555 is likely out of reach. In the longer run, bias remains on the upside, but it remains to be seen if AUD can break clearly above 0.6555, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. Bias remains on the upside24-HOUR VIEW: "The following are excerpts from our update yesterday: 'There has been a slight increase in momentum. Today, there is potential for AUD to test 0.6535. Given the current mild momentum, a clear break above this level is unlikely. The major resistance at 0.6555 is also unlikely to come under threat. Support is at 0.6500; a breach of 0.6485 would indicate that the current mild upward pressure has eased.' Our analysis was not wrong, as after dipping briefly to 0.6490, AUD rose to 0.6533. Upward momentum has increased further, indicating further upside pressure. However, the major resistance at 0.6555 is likely out of reach. There is another resistance level at 0.6540. Today’s support levels are at 0.6510 and 0.6490." 1-3 WEEKS VIEW: "We have expected a positive bias in AUD since early last week. In our latest narrative from last Friday (06 Jun, spot at 0.6510), we indicated that 'the bias remains on the upside, but it remains to be seen if AUD can break clearly above 0.6555.' While there has been a slight increase in short-term upward momentum, currently, it is still unclear whether AUD can break clearly above 0.6555. Overall, only a breach of 0.6480 (‘strong support’ level previously at 0.6470) would indicate that the likelihood of AUD breaking above 0.6555 has faded."
12:37 AUD/USD drifts closer to 0.6500 with the focus turning to the US CPI release
The Australian Dollar is trading lower on Wednesday, retracing Tuesday’s gains as the frail enthusiasm about an alleged trade deal between the US and China faded, with markets turning cautious ahead of the release of US Inflation data.US and China seem to have reached a deal to ease restrictions on
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US and China seem to have reached a deal to ease restrictions on rare metals’ trade and reduce tariffs, but the parties have offered few details about the agreement, which grants little guarantee about its durability.
Markets reacted with moderate enthusiasm immediately after the news, but optimism faded soon. The Aussie Dollar went through a limited upside reaction before losing ground, returning to levels right above 0.6500 at the moment of writing.A weak US Dollar keeps the Aussie afloatThe US Dollar, on the other hand, is pulling back from previous highs. The USD Index, which measures the value of the Dollar against the world’s most traded currencies, has retreated below the 99.00 level after hitting 99.20 highs immediately after the trade deal.Investors are growing increasingly cautious ahead of the US Consumer Price Index release. The monthly CPI is expected to have remained steady at 0.2%, with the yearly rate accelerating to 2.5% from the previous 2.3%. The Core CPI is seen increasing to 0.3% on the month and 2.9% year-on-year, from 0.2% and 2.8% respectively.
Beyond that, the US Treasury faces a $39 billion auction of 10-year Bonds, amid rising concerns about the country’s fiscal health. A significant decline in demand from May’s auction might increase bearish pressure on the USD. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
US and China seem to have reached a deal to ease restrictions on rare metals’ trade and reduce tariffs, but the parties have offered few details about the agreement, which grants little guarantee about its durability.
Markets reacted with moderate enthusiasm immediately after the news, but optimism faded soon. The Aussie Dollar went through a limited upside reaction before losing ground, returning to levels right above 0.6500 at the moment of writing.A weak US Dollar keeps the Aussie afloatThe US Dollar, on the other hand, is pulling back from previous highs. The USD Index, which measures the value of the Dollar against the world’s most traded currencies, has retreated below the 99.00 level after hitting 99.20 highs immediately after the trade deal.Investors are growing increasingly cautious ahead of the US Consumer Price Index release. The monthly CPI is expected to have remained steady at 0.2%, with the yearly rate accelerating to 2.5% from the previous 2.3%. The Core CPI is seen increasing to 0.3% on the month and 2.9% year-on-year, from 0.2% and 2.8% respectively.
Beyond that, the US Treasury faces a $39 billion auction of 10-year Bonds, amid rising concerns about the country’s fiscal health. A significant decline in demand from May’s auction might increase bearish pressure on the USD. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
12:33 Germany 10-y Bond Auction down to 2.54% from previous 2.66%
Germany 10-y Bond Auction down to 2.54% from previous 2.66%
12:32 Silver price today: Silver falls, according to FXStreet data
Silver prices (XAG/USD) fell on Wednesday, according to FXStreet data.
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Silver prices (XAG/USD) fell on Wednesday, according to FXStreet data. Silver trades at $36.29 per troy ounce, down 0.56% from the $36.50 it cost on Tuesday.
Silver prices have increased by 25.61% since the beginning of the year. Unit measure Silver Price Today in USD Troy Ounce 36.29 1 Gram 1.17
The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 91.99 on Wednesday, up from 91.06 on Tuesday. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver. (An automation tool was used in creating this post.)
The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, stood at 91.99 on Wednesday, up from 91.06 on Tuesday. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver. (An automation tool was used in creating this post.)
12:31 South Africa Business Confidence Index declined to 114.9 in April from previous 123.5
South Africa Business Confidence Index declined to 114.9 in April from previous 123.5
12:30 South Africa Business Confidence Index down to 115.8 in April from previous 123.5
South Africa Business Confidence Index down to 115.8 in April from previous 123.5
12:20 United Kingdom 10-y Bond Auction down to 4.588% from previous 4.673%
United Kingdom 10-y Bond Auction down to 4.588% from previous 4.673%
12:17 BoJ’s Ueda: Uncertainty surrounding Japan, overseas economies very high
A Japanese cabinet official quotes Bank of Japan (BoJ) Governor Kazuo Ueda on Wednesday as the central bank chief attended the meeting on the monthly economic report.
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A Japanese cabinet official quotes Bank of Japan (BoJ) Governor Kazuo Ueda on Wednesday as the central bank chief attended the meeting on the monthly economic report.Key takeawaysMarkets' risk-aversive moves subsiding somewhat but uncertainty surrounding Japan, overseas economies is very high.
The BoJ will continue to scrutinize market moves, impact on the economy.
Domestic financial conditions remain accommodative.Market reactionFollowing these comments, USD/JPY defends minor bids near 145.00. Bank of Japan FAQs What is the Bank of Japan? The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%. What has been the Bank of Japan’s policy? The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance. How do Bank of Japan’s decisions influence the Japanese Yen? The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance. Why did the Bank of Japan decide to start unwinding its ultra-loose policy? A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
The BoJ will continue to scrutinize market moves, impact on the economy.
Domestic financial conditions remain accommodative.Market reactionFollowing these comments, USD/JPY defends minor bids near 145.00. Bank of Japan FAQs What is the Bank of Japan? The Bank of Japan (BoJ) is the Japanese central bank, which sets monetary policy in the country. Its mandate is to issue banknotes and carry out currency and monetary control to ensure price stability, which means an inflation target of around 2%. What has been the Bank of Japan’s policy? The Bank of Japan embarked in an ultra-loose monetary policy in 2013 in order to stimulate the economy and fuel inflation amid a low-inflationary environment. The bank’s policy is based on Quantitative and Qualitative Easing (QQE), or printing notes to buy assets such as government or corporate bonds to provide liquidity. In 2016, the bank doubled down on its strategy and further loosened policy by first introducing negative interest rates and then directly controlling the yield of its 10-year government bonds. In March 2024, the BoJ lifted interest rates, effectively retreating from the ultra-loose monetary policy stance. How do Bank of Japan’s decisions influence the Japanese Yen? The Bank’s massive stimulus caused the Yen to depreciate against its main currency peers. This process exacerbated in 2022 and 2023 due to an increasing policy divergence between the Bank of Japan and other main central banks, which opted to increase interest rates sharply to fight decades-high levels of inflation. The BoJ’s policy led to a widening differential with other currencies, dragging down the value of the Yen. This trend partly reversed in 2024, when the BoJ decided to abandon its ultra-loose policy stance. Why did the Bank of Japan decide to start unwinding its ultra-loose policy? A weaker Yen and the spike in global energy prices led to an increase in Japanese inflation, which exceeded the BoJ’s 2% target. The prospect of rising salaries in the country – a key element fuelling inflation – also contributed to the move.
12:10 China’s Vice Premier He: China's stance on trade issues with the US is clear and consistent
Following the US-China trade talks in London, Chinese Vice Premier He Lifeng said on Wednesday that “China's stance on trade issues with the US is clear and consistent.”
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Following the US-China trade talks in London, Chinese Vice Premier He Lifeng said on Wednesday that “China's stance on trade issues with the US is clear and consistent.”Additional quotesChina not willing to fight but not afraid to fight.
Two sides should enhance concensus.
Both should strengthen cooperation.
Two sides should jointly safeguard the hard-won outcome from the dialogues.
Both should maintain communication.
Should push for stable and long-term China-US trade and economic ties.Market reactionThe Chinese proxy, the Australian Dollar (AUD) is uninspired by these comments, with AUD/USD down 0.17% on the day at 0.6511 at the time of writing. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
Two sides should enhance concensus.
Both should strengthen cooperation.
Two sides should jointly safeguard the hard-won outcome from the dialogues.
Both should maintain communication.
Should push for stable and long-term China-US trade and economic ties.Market reactionThe Chinese proxy, the Australian Dollar (AUD) is uninspired by these comments, with AUD/USD down 0.17% on the day at 0.6511 at the time of writing. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
12:07 EUR/CAD Price Forecast: Tests 1.5650 barrier near descending channel’s upper boundary
EUR/CAD recovers its recent losses, trading around 1.5640 during the European hours on Wednesday. Technical analysis on the daily chart points to the potential weakening of a bearish bias, with the currency cross hovering near the upper boundary of the descending channel.
.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}EUR/CAD may approach the 1.5857, the highest level since July 2020.The 14-day Relative Strength Index moves slightly above the 50 level, suggesting a potential emergence of the bullish bias.The nine-day Exponential Moving Average at 1.5634 acts as the initial support.EUR/CAD recovers its recent losses, trading around 1.5640 during the European hours on Wednesday. Technical analysis on the daily chart points to the potential weakening of a bearish bias, with the currency cross hovering near the upper boundary of the descending channel.The EUR/CAD cross is positioned above the 50-day Exponential Moving Average (EMA), suggesting that short-term price momentum is stronger. Additionally, the 14-day Relative Strength Index (RSI) is positioned slightly above the 50 level, suggesting the potential emergence of a bullish bias.On the upside, a successful breach above the descending channel may prompt the emergence of a bullish bias and lead the EUR/CAD cross to explore the region around 1.5857, the highest level since July 2020, reached on March 11.The immediate support appears at the nine-day Exponential Moving Average (EMA) of 1.5634, followed by the 50-day EMA at 1.5599. Further declines below these levels could dampen the short- and medium-term price momentum and put downward pressure on the EUR/CAD cross to navigate the region around the descending channel’s lower boundary around 1.5290.EUR/CAD: Daily Chart Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD -0.11% 0.04% 0.12% 0.07% 0.17% 0.35% -0.12% EUR 0.11% 0.14% 0.20% 0.15% 0.27% 0.40% -0.02% GBP -0.04% -0.14% 0.06% 0.05% 0.15% 0.27% -0.17% JPY -0.12% -0.20% -0.06% -0.14% 0.07% 0.21% -0.26% CAD -0.07% -0.15% -0.05% 0.14% 0.14% 0.25% -0.21% AUD -0.17% -0.27% -0.15% -0.07% -0.14% 0.13% -0.30% NZD -0.35% -0.40% -0.27% -0.21% -0.25% -0.13% -0.43% CHF 0.12% 0.02% 0.17% 0.26% 0.21% 0.30% 0.43% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
12:05 EUR/GBP: Spending Review not a game-changer – ING
Wednesday’s Spending Review shouldn't be a big moment for financial markets, ING's FX analyst Francesco Pesole notes.
Wednesday’s Spending Review shouldn't be a big moment for financial markets, ING's FX analyst Francesco Pesole notes. Tax rises loom in autumn budget"We already know how quickly investment and departmental budgets will rise over the next few years, and today's announcement simply tells us how the overall pot gets divvied up. But it will emphasise that when it comes to day-to-day spending, there's not enough cash to go around, and more money will need to be found at the Autumn Budget." "Added to which, we think the Treasury's slim fiscal headroom against its fiscal rules has fully evaporated and tax rises will be needed later this year to plug the gap.”"The GBP lost some steam after soft UK jobs data yesterday. Budget events often stir gilt market volatility, so EUR/GBP might get a bit of bullish momentum and test 0.850 in the coming days."
11:54 GBP/USD: Any decline may be limited to a retest of the 1.3460 level – UOB Group
Further Pound Sterling (GBP) weakness is not ruled out against US Dollar (USD); oversold conditions suggest any decline may be limited to a retest of the 1.3460 level.
Further Pound Sterling (GBP) weakness is not ruled out against US Dollar (USD); oversold conditions suggest any decline may be limited to a retest of the 1.3460 level. In the longer run, tentative increase in downward momentum suggests GBP is likely to trade with a downward bias toward 1.3430, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. GBP is likely to trade with a downward bias toward 1.343024-HOUR VIEW: "Our view for GBP to trade in a range yesterday was incorrect, as it plunged to 1.3458, rebounding to close at 1.3498, down by 0.38%. While further GBP weakness is not ruled out today, oversold conditions suggest that any decline may be limited to a retest of the 1.3460 level. The next support at 1.3420 is unlikely to come under threat. Resistance levels are at 1.3525 and 1.3555." 1-3 WEEKS VIEW: "We turned positive on GBP early last week. In our latest narrative from two days ago (09 Jun, spot at 1.3540), we highlighted that 'as long as 1.3500 is not breached, there is a chance for GBP to retest 1.3615 before the risk of a more sustained and sizeable pullback increases.' Yesterday, GBP broke below 1.3500, reaching a low of 1.3458. Upward momentum has faded, and there has been a tentative increase in downward momentum. From here, GBP is likely to trade with a downward bias toward 1.3420. A clear break of this level could potentially trigger a deeper decline. The downward bias will remain intact as long as the ‘strong resistance’ level at 1.3580 is not breached."
11:50 EUR: ECB reinforcing hawkish tone – ING
This week’s moves are almost entirely driven by US-related events. The only Euro input comes from scheduled ECB speeches, which so far have reinforced the less dovish tone set by President Christine Lagarde last week, ING's FX analyst Francesco Pesole notes.
This week’s moves are almost entirely driven by US-related events. The only Euro input comes from scheduled ECB speeches, which so far have reinforced the less dovish tone set by President Christine Lagarde last week, ING's FX analyst Francesco Pesole notes.EUR/USD’s direction today is set by the US Dollar for now"Croatia’s central bank chief, Boris Vucic, confirmed the new consensus on the ECB yesterday, saying the bank is in a 'very good position' and should wait for 'another projection' – meaning September – before making its next move. Markets are pricing in 15bp for September, 17bp for October, and 30bp for December.""From an FX angle, the impact isn’t huge. EUR/USD surged last week on the ECB’s hawkish shift, but short-term rate differentials aren’t driving G10 FX beyond central bank events. As noted, EUR/USD’s direction today will be mostly set by the dollar, with some support likely near 1.1400 and a possible push above 1.1500 by the week’s end."
11:47 US Oil production set to decline – ING
The Energy Information Administration (EIA) revised its US crude Oil production estimates downward for 2026. In its latest Short-Term Energy Outlook, released yesterday, the EIA said output would decline by 50k b/d year on year in 2026 to 13.37m b/d.
The Energy Information Administration (EIA) revised its US crude Oil production estimates downward for 2026. In its latest Short-Term Energy Outlook, released yesterday, the EIA said output would decline by 50k b/d year on year in 2026 to 13.37m b/d. This would be the first annual decline in US output since 2021, when Covid hit production. Meanwhile, output growth for 2025 was left unchanged at 210k b/d YoY. The decline isn’t too surprising, given the recent slowdown in drilling activity, ING's commodity experts Ewa Manthey and Warren Patterson note.EIA sees first U.S. Oil output decline since 2021 amid drilling slowdown"There’s growing uncertainty in the refined products market as the European Commission proposes a ban on imports made from Russian crude Oil, according to a statement from Ursula von der Leyen, the President of the European Commission. While the EU has already banned the import of Russian crude Oil and refined products, the bloc is importing refined products from third countries that process Russian crude Oil.""This would mostly put refined product imports from India and Turkey at risk. Both countries import Russian crude Oil and export refined products to the EU. According to LSEG data, India and Turkey imported 1.77m b/d of Russian crude Oil in the first quarter of 2025, while the EU imported more than 350k b/d of refined products from these two countries. The bulk of this flow is middle distillates. Such a move would lead to yet another shift in refined product trade flows. But the Commission implementing such a ban would be difficult, given that refiners blend different types of crude Oil. Determining the origin of the crude Oil becomes challenging.""The latest numbers from the American Petroleum Institute (API) show that US crude Oil inventories fell by around 400k barrels over the last week, less than the roughly 2.6m barrel draw the market expected. Changes in refined products were more bearish with gasoline and distillate stocks increasing by 3m barrels and 3.7m barrels, respectively."
11:46 EUR/USD: Likely to trade in a range of 1.1385/1.1460 – UOB Group
There has been no increase in either downward or upward momentum; Euro (EUR) is likely to trade in a range of 1.1385/1.1460. In the longer run, EUR appears to have entered a range trading phase between 1.1330 and 1.1495, UOB Group's FX analysts Quek Ser Leang and Peter Chia note.
There has been no increase in either downward or upward momentum; Euro (EUR) is likely to trade in a range of 1.1385/1.1460. In the longer run, EUR appears to have entered a range trading phase between 1.1330 and 1.1495, UOB Group's FX analysts Quek Ser Leang and Peter Chia note. EUR appears to have entered a range trading phase24-HOUR VIEW: "EUR traded in a range two days ago. Yesterday, we indicated that 'the price movements did not result in any increase in either downward or upward momentum.' We expected EUR to 'trade in a range of 1.1390/1.1445.' However, EUR dropped to a low of 1.1372, rebounded to 1.1447, before easing to end the day at 1.1423, marginally higher by 0.03%. Once again, there has been no increase in either downward or upward momentum. Today, we expect EUR to trade in a range of 1.1385/1.1460." 1-3 WEEKS VIEW: "We revised our view to neutral two days ago (09 Jun, spot at 1.1405), indicating that EUR 'appears to have entered a range trading phase, likely between 1.1330 and 1.1495.' We maintain the same view for now."
11:37 ECB's Kazaks: Keeping 2% inflation will require some further cuts for fine tuning
European Central Bank (ECB) policymaker Martins Kazaks said on Wednesday, “quite likely keeping 2% inflation will require some further cuts for fine tuning.”
.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}European Central Bank (ECB) policymaker Martins Kazaks said on Wednesday, “quite likely keeping 2% inflation will require some further cuts for fine tuning.”Additional quotes Market pricing of one more cut or so not out of the realm of the baseline.
Fine-tuning cuts will very much depend on how the economy develops.
May at some point, not yet by any means, go into accommodative territory.
Must be cautious about potential persistence of undershooting.
We need to take care of those risks of a too persistent or large deviation from target.
So far, seems deflationary effect of trade tensions could dominate, but final outcome open.
June cut to ensure that inflation in 2026 eventually turns the corner and starts returning towards 2%.Market reactionAt the time of writing, EUR/USD is holding steady at 1.1428, awaiting the US Consumer Price Index (CPI) data for fresh trading impetus. Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Swiss Franc. USD EUR GBP JPY CAD AUD NZD CHF USD -0.06% 0.08% 0.13% 0.05% 0.16% 0.37% -0.10% EUR 0.06% 0.13% 0.17% 0.09% 0.20% 0.37% -0.05% GBP -0.08% -0.13% 0.04% -0.01% 0.09% 0.25% -0.19% JPY -0.13% -0.17% -0.04% -0.16% 0.05% 0.23% -0.25% CAD -0.05% -0.09% 0.00% 0.16% 0.14% 0.28% -0.17% AUD -0.16% -0.20% -0.09% -0.05% -0.14% 0.17% -0.26% NZD -0.37% -0.37% -0.25% -0.23% -0.28% -0.17% -0.44% CHF 0.10% 0.05% 0.19% 0.25% 0.17% 0.26% 0.44% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Fine-tuning cuts will very much depend on how the economy develops.
May at some point, not yet by any means, go into accommodative territory.
Must be cautious about potential persistence of undershooting.
We need to take care of those risks of a too persistent or large deviation from target.
So far, seems deflationary effect of trade tensions could dominate, but final outcome open.
June cut to ensure that inflation in 2026 eventually turns the corner and starts returning towards 2%.Market reactionAt the time of writing, EUR/USD is holding steady at 1.1428, awaiting the US Consumer Price Index (CPI) data for fresh trading impetus. Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the weakest against the Swiss Franc. USD EUR GBP JPY CAD AUD NZD CHF USD -0.06% 0.08% 0.13% 0.05% 0.16% 0.37% -0.10% EUR 0.06% 0.13% 0.17% 0.09% 0.20% 0.37% -0.05% GBP -0.08% -0.13% 0.04% -0.01% 0.09% 0.25% -0.19% JPY -0.13% -0.17% -0.04% -0.16% 0.05% 0.23% -0.25% CAD -0.05% -0.09% 0.00% 0.16% 0.14% 0.28% -0.17% AUD -0.16% -0.20% -0.09% -0.05% -0.14% 0.17% -0.26% NZD -0.37% -0.37% -0.25% -0.23% -0.28% -0.17% -0.44% CHF 0.10% 0.05% 0.19% 0.25% 0.17% 0.26% 0.44% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
11:30 US Dollar Index (DXY) remains capped below 99.20 despite the US-China deal
The Dollar featured a tepid reaction to the trade deal between the US and China.
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The US-China deal fails to provide any significant support to the US Dollar.The lack of details about the agreement has triggered some scepticism among the investors.Markets are increasingly cautious ahead of the US CPI release and a 10-Year US Bond auction.The Dollar featured a tepid reaction to the trade deal between the US and China. Price action has remained limited within the last four days’ trading range, with upside attempts failing to find follow-through above the 99.00 level.
The world’s two major economies seem to have agreed on a “framework” to ease restrictions on rare earths trade, allowing them to return to last month’s Geneva talks consensus. Details of the agreement, however, have been scarce, and left markets wondering about the durability of the deal.Doubts about the deal are limiting Dollar’s upside attemptsInvestors have come to terms with the idea that a deal is better than no deal, but their reaction has been far from enthusiastic. The Dollar appreciated during Wednesday’s Asian session, before trimming gains at the European session opening, with all eyes on the US CPI and an auction of US Treasuries.
Consumer inflation is expected to have accelerated in May, mainly driven by higher energy prices, but the Core CPI might start to show the impact of Trump’s tariffs. Markets are increasingly wary of an upside surprise in price pressures, which might revive stagflation fears and pose a serious challenge to the Fed.
Apart from that, a $39 billion auction of 10-year Treasury bonds will be closely watched to assess the impact of the US debt crisis on the bond market. A key point will be the interest from indirect bidders, which, in May, took 71% of the supply. A weak demand is likely to hurt the US Dollar.
Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
The world’s two major economies seem to have agreed on a “framework” to ease restrictions on rare earths trade, allowing them to return to last month’s Geneva talks consensus. Details of the agreement, however, have been scarce, and left markets wondering about the durability of the deal.Doubts about the deal are limiting Dollar’s upside attemptsInvestors have come to terms with the idea that a deal is better than no deal, but their reaction has been far from enthusiastic. The Dollar appreciated during Wednesday’s Asian session, before trimming gains at the European session opening, with all eyes on the US CPI and an auction of US Treasuries.
Consumer inflation is expected to have accelerated in May, mainly driven by higher energy prices, but the Core CPI might start to show the impact of Trump’s tariffs. Markets are increasingly wary of an upside surprise in price pressures, which might revive stagflation fears and pose a serious challenge to the Fed.
Apart from that, a $39 billion auction of 10-year Treasury bonds will be closely watched to assess the impact of the US debt crisis on the bond market. A key point will be the interest from indirect bidders, which, in May, took 71% of the supply. A weak demand is likely to hurt the US Dollar.
Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
11:29 USD/CHF moves little near 0.8200 as traders adopt caution ahead of US CPI data
USD/CHF offers its recent gains registered in the previous session, trading around 0.8220 during the European hours on Wednesday.
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However, the pair may regain its ground as the Swiss Franc (CHF) may struggle due to weakened safe-haven demand, driven by the improved risk sentiment amid easing tariff tensions between the United States (US) and China.US Commerce Secretary Howard Lutnick suggested, on Tuesday, potential resolutions with China and noted that both countries have reached a framework to implement the Geneva Consensus. While China’s Vice Commerce Minister Li Chenggang said that communication with the United States has been rational and candid, he will report on a framework to Chinese leaders. However, officials from both sides will seek approval from their leaders before implementation, according to Bloomberg.US Treasury yields are holding steady as traders adopt caution ahead of the upcoming inflation data. The CPI report is expected to provide insight into the economic impact of recent tariffs and broader inflationary trends. 2-year and 10-year yields on US Treasury bonds are standing at 4.01% and 4.46%, respectively, at the time of writing.In Switzerland, last week, Consumer Price Index (CPI) fell by 0.1% YoY in May, slipping below the Swiss National Bank’s (SNB) 0-2% target range and marking the first deflationary reading since March 2021. The softer inflation data has raised the odds of the Swiss National Bank (SNB) delivering a 25 basis point rate cut in the next meeting on June 19. Swiss Franc FAQs What key factors drive the Swiss Franc? The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone. Why is the Swiss Franc considered a safe-haven currency? The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in. How do decisions of the Swiss National Bank impact the Swiss Franc? The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF. How does economic data influence the value of the Swiss Franc? Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate. How does the Eurozone monetary policy affect the Swiss Franc? As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.
10:59 Pound Sterling ticks down against US Dollar ahead of US inflation data
The Pound Sterling (GBP) trades lower to near 1.3480 against the US Dollar (USD) during European trading hours on Wednesday.
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The GBP/USD pair ticks down as the US Dollar trades broadly stable ahead of the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, edges up slightly to near 99.15.Investors will pay close attention to the US inflation data as it will influence market expectations for the Federal Reserve’s (Fed) monetary policy outlook. As measured by the CPI, headline inflation is expected to have risen to 2.5% on year from 2.3% in April. In the same period, core CPI – which excludes volatile food and energy prices – is expected to have grown by 2.9%, faster than the prior 2.8%. On month, both headline and core CPI are expected to have grown by 0.2% and 0.3%, respectively.Signs of accelerating price pressures would allow Federal Reserve (Fed) officials to commit to holding interest rates steady until they get clarity over the outcome of the tariff policy by US President Donald Trump after returning to the White House. Even if inflation data came in lower than expected, Fed policymakers are unlikely to support early interest rate cuts, as they have been citing concerns over de-anchoring consumer inflation expectations under the leadership of Donald Trump.On the global front, trade tensions between the US and China have de-escalated somewhat as the White House has signaled a positive outcome from the two-day meetings between trade representatives of both countries held in London. US Secretary of Commerce Howard Lutnick expressed confidence that both nations will roll back export restrictions.Daily digest market movers: Pound Sterling extends underperformance against its peersThe Pound Sterling extends its downside move against its major peers on Wednesday, extending the previous day’s sell-off. The British currency faces sharp selling pressure on Tuesday after the United Kingdom (UK) Office for National Statistics (ONS) reported a weak set of labor market data for three months leading up to April.The data showed cracks emerging in the UK labor market as the decision by Chancellor of the Exchequer Rachel Reeves to raise employers’ contribution to social security schemes to 15% from 13.8% went into effect in April.According to the report, the Unemployment Rate accelerated to 4.6%, the highest level seen since July 2021. Also, labor demand slowed significantly, and wages grew at a moderate pace.Soft UK employment data has increased market expectations that the Bank of England (BoE) will reduce interest rates by more than what investors had projected earlier. “Weak jobs and slower pay growth may tip the balance in favour of an August cut," HSBC analysts said. Later this week, investors will focus on the UK monthly Gross Domestic Product and the factory data for April, which will be released on Thursday. The UK economy is expected to have shrunk by 0.1% after expanding 0.2% in March. On month, both the Manufacturing and Industrial Production data are expected to have contracted again.Technical Analysis: Pound Sterling corrects to near 20-day EMAThe Pound Sterling declines to near the 20-Day Exponential Moving Average (EMA) at around 1.3467, indicating uncertainty in the near-term trend. The GBP/USD pair faced selling pressure on Tuesday after failing to revisit the three-year high of 1.3617.The 14-day Relative Strength Index (RSI) falls sharply towards the 50 neutral level, indicating that the upside potential is capped.On the upside, the three-year high of 1.3617 will be a key hurdle for the pair. Looking down, the May 15 low of 1.3258 will act as a key support zone. Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data.
Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates.
When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money.
When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP.
A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
10:55 Silver Price Forecast: XAG/USD turns sideways around $36.50 as investors await US inflation data
Silver price (XAG/USD) trades in a tight range around $36.50 during European trading hours on Wednesday. The white metal consolidates as investors await the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.
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The white metal consolidates as investors await the United States (US) Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT.Economists expect the US headline inflation to have grown at a faster pace of 2.5% on year, compared to 2.3% in April. In the same period, the core CPI – which excludes volatile food and energy prices – grew by 2.9%, faster than the prior release of 2.8%. On month, the headline and the core CPI are expected to have grown by 0.2% and 0.3%, respectively.The scenario of price pressures accelerating would allow Federal Reserve (Fed) officials to commit their stance of holding interest rates at their current levels long enough until they get clarity on how much new economic policies by US President Donald Trump will impact the economic and the inflation outlook.Theoretically, the maintenance of a restrictive monetary policy stance by the Fed for a longer period bodes poorly for non-yielding assets, such as Silver.Ahead of the US inflation data for May, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, ticks up to near 99.20.On the global front, trade tensions between the US and China have eased after a two meeting in London. US Secretary of Commerce Howard Lutnick has expressed confidence that Washington will roll back export controls on sophisticated chips after China will reverse export restrictions on “rare earths”.Historically, signs of easing global tensions diminish the appeal of safe-haven assets, such as Silver.Silver technical analysisSilver price rally pauses after posting a fresh over-a-decade high around $36.90. However, the near-term outlook of the white metal remains bullish as the 20-day Exponential Moving Average (EMA) slopes higher, which is currently around $34.50.The 14-day Relative Strength Index (RSI) holds above 70.00, indicating a strong bullish momentum.Looking up, psychological level of $40.00 will be the major resistance for the Silver price. On the downside, the October 22 high of $34.87 will act as key support for the asset.Silver daily chart Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
10:54 EUR/USD nudges lower as US Dollar picks up after an alleged US-China deal
EUR/USD has pulled lower to levels just above 1.1400 on Wednesday, as the US Dollar strengthened following headlines that US and Chinese representatives have reached a framework to reduce trade tariffs.The deal now has to be approved by US President Donald Trump and Chinese Premier Xi Jinping, and t
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.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The Euro has posted a limited bearish reaction to the reached US-China trade deal. The lack of details on the agreement has raised doubts about its scope. EUR/USD remains indecisive, looking for direction between 1.1375 and 1.1455.EUR/USD has pulled lower to levels just above 1.1400 on Wednesday, as the US Dollar strengthened following headlines that US and Chinese representatives have reached a framework to reduce trade tariffs.
The deal now has to be approved by US President Donald Trump and Chinese Premier Xi Jinping, and the details of it have been scarce, causing a tepid market reaction so far.
Investors have welcomed the news with scepticism, as it keeps tariffs in place, albeit at lower levels, and offers little guarantee of its durability. The pair’s reaction remains constrained within the same range between 1.1375 and 1.1455 seen over the last two weeks.
US Commerce Secretary Howard Lutnick affirmed that both countries have reached an agreement to implement the Geneva consensus, which was previously abandoned due to US complaints on China’s restrictions on rare earths trade.
Beyond that, a US federal court said that Trump’s most sweeping tariffs will remain in effect temporarily, at least until the judges decide on an initial lower court decision that ruled them illegal a few weeks ago.
On the economic calendar front, the highlight will be May’s US Consumer Price Index (CPI) data due later in the day, which is expected to show that inflation accelerated moderately and might revive fears of stagflation. Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD 0.03% 0.10% 0.15% 0.02% 0.11% 0.33% -0.02% EUR -0.03% 0.07% 0.12% -0.02% 0.08% 0.24% -0.05% GBP -0.10% -0.07% 0.04% -0.06% 0.03% 0.18% -0.14% JPY -0.15% -0.12% -0.04% -0.22% -0.03% 0.15% -0.20% CAD -0.02% 0.02% 0.06% 0.22% 0.12% 0.27% -0.07% AUD -0.11% -0.08% -0.03% 0.03% -0.12% 0.16% -0.14% NZD -0.33% -0.24% -0.18% -0.15% -0.27% -0.16% -0.32% CHF 0.02% 0.05% 0.14% 0.20% 0.07% 0.14% 0.32% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Daily digest market movers: Markets are cautious ahead of US CPI figuresThe trade negotiations between the US and China have ended with a framework that, in the best of cases, brings the situation back to last month´s Geneva consensus. The market reaction has been far from enthusiastic.
The focus on Wednesday will be on the US CPI figures, which are expected to have increased steadily at a 0.2% pace month-over-month in May, with the yearly inflation accelerating to 2.5% from 2.3% in the previous month.
The market will be particularly attentive to deviations in consumer inflation, as it will determine the Federal Reserve’s (Fed) near-term monetary policy plans. Futures markets anticipate that the central bank will keep interest rates on hold in June and July, but they are evenly split about September’s decision.
Apart from that, a $39 billion auction of US 10-year Treasury bonds will be observed with interest amid increasing concerns about US fiscal stability. The main focus will be on the demand from indirect bidders, which amounted to 71% of May’s auction. A significant decline in it might increase bearish pressure on the US Dollar.
European data released on Tuesday revealed a larger-than-expected improvement in investors' confidence, which rose to a 0.2 reading in June, up from a -8.1 in May and a -19.5 in April, boosted by brighter expectations about the Eurozone’s economic outlook.
European Central Bank (ECB) policymaker Olli Rehn stated that the central bank should focus on keeping inflation steady at 2% and warned about complacency over the inflation outlook. These comments echo ECB President Christine Lagarde’s remarks after last week’s meeting and curb hopes of further monetary easing in the coming monthTechnical analysis: EUR/USD keeps treading water below 1.1455 EUR/USD is consolidating gains after the late-May rally, with price action trapped within an 80-pip range below 1.1455 since early June. The Relative Strength Index (RSI) is wavering around the 50 level on the 4-hour chart, but the rejection near 1.1500 last week and a bearish divergence suggest that bulls have lost momentum.
The pair is looking for direction above 1.1400 on Wednesday with key support at 1.1375 (near June 6 and 10 lows). A breach of this level is needed to confirm a deeper correction heading to 1.1315 (May 30 low) and 1.1215-1.1220 (May 28 and 20 lows).
On the upside, immediate resistance is at the June 3 high at 1.1455, ahead of the June 5 high at 1.1495. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
The deal now has to be approved by US President Donald Trump and Chinese Premier Xi Jinping, and the details of it have been scarce, causing a tepid market reaction so far.
Investors have welcomed the news with scepticism, as it keeps tariffs in place, albeit at lower levels, and offers little guarantee of its durability. The pair’s reaction remains constrained within the same range between 1.1375 and 1.1455 seen over the last two weeks.
US Commerce Secretary Howard Lutnick affirmed that both countries have reached an agreement to implement the Geneva consensus, which was previously abandoned due to US complaints on China’s restrictions on rare earths trade.
Beyond that, a US federal court said that Trump’s most sweeping tariffs will remain in effect temporarily, at least until the judges decide on an initial lower court decision that ruled them illegal a few weeks ago.
On the economic calendar front, the highlight will be May’s US Consumer Price Index (CPI) data due later in the day, which is expected to show that inflation accelerated moderately and might revive fears of stagflation. Euro PRICE Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest against the New Zealand Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD 0.03% 0.10% 0.15% 0.02% 0.11% 0.33% -0.02% EUR -0.03% 0.07% 0.12% -0.02% 0.08% 0.24% -0.05% GBP -0.10% -0.07% 0.04% -0.06% 0.03% 0.18% -0.14% JPY -0.15% -0.12% -0.04% -0.22% -0.03% 0.15% -0.20% CAD -0.02% 0.02% 0.06% 0.22% 0.12% 0.27% -0.07% AUD -0.11% -0.08% -0.03% 0.03% -0.12% 0.16% -0.14% NZD -0.33% -0.24% -0.18% -0.15% -0.27% -0.16% -0.32% CHF 0.02% 0.05% 0.14% 0.20% 0.07% 0.14% 0.32% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent EUR (base)/USD (quote).
Daily digest market movers: Markets are cautious ahead of US CPI figuresThe trade negotiations between the US and China have ended with a framework that, in the best of cases, brings the situation back to last month´s Geneva consensus. The market reaction has been far from enthusiastic.
The focus on Wednesday will be on the US CPI figures, which are expected to have increased steadily at a 0.2% pace month-over-month in May, with the yearly inflation accelerating to 2.5% from 2.3% in the previous month.
The market will be particularly attentive to deviations in consumer inflation, as it will determine the Federal Reserve’s (Fed) near-term monetary policy plans. Futures markets anticipate that the central bank will keep interest rates on hold in June and July, but they are evenly split about September’s decision.
Apart from that, a $39 billion auction of US 10-year Treasury bonds will be observed with interest amid increasing concerns about US fiscal stability. The main focus will be on the demand from indirect bidders, which amounted to 71% of May’s auction. A significant decline in it might increase bearish pressure on the US Dollar.
European data released on Tuesday revealed a larger-than-expected improvement in investors' confidence, which rose to a 0.2 reading in June, up from a -8.1 in May and a -19.5 in April, boosted by brighter expectations about the Eurozone’s economic outlook.
European Central Bank (ECB) policymaker Olli Rehn stated that the central bank should focus on keeping inflation steady at 2% and warned about complacency over the inflation outlook. These comments echo ECB President Christine Lagarde’s remarks after last week’s meeting and curb hopes of further monetary easing in the coming monthTechnical analysis: EUR/USD keeps treading water below 1.1455 EUR/USD is consolidating gains after the late-May rally, with price action trapped within an 80-pip range below 1.1455 since early June. The Relative Strength Index (RSI) is wavering around the 50 level on the 4-hour chart, but the rejection near 1.1500 last week and a bearish divergence suggest that bulls have lost momentum.
The pair is looking for direction above 1.1400 on Wednesday with key support at 1.1375 (near June 6 and 10 lows). A breach of this level is needed to confirm a deeper correction heading to 1.1315 (May 30 low) and 1.1215-1.1220 (May 28 and 20 lows).
On the upside, immediate resistance is at the June 3 high at 1.1455, ahead of the June 5 high at 1.1495. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
10:54 GBP/JPY treads water above 195.50, maintains position near five-month highs
GBP/JPY remains subdued for the third consecutive day, trading around 195.60 during the early European hours on Wednesday. However, the currency cross maintains its position near a five-month high of 196.45, which was recorded on Tuesday, with hopes of further gains.
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GBP/JPY hovers near a five-month high of 196.45, reached on Tuesday.A Reuters poll suggested that the BoJ will not increase interest rates in 2025 amid uncertainty over US tariff policy.The safe-haven JPY struggles due to easing US-China tariff tensions.GBP/JPY remains subdued for the third consecutive day, trading around 195.60 during the early European hours on Wednesday. However, the currency cross maintains its position near a five-month high of 196.45, which was recorded on Tuesday, with hopes of further gains. The Japanese Yen (JPY) faces challenges following a Reuters poll, suggesting that the Bank of Japan (BoJ) will not raise another interest rate again this year due to uncertainty over US tariff policy.Out of 60 economists who participated in the Reuters survey conducted between June 2-10, no one expected the BoJ to increase rates at its upcoming policy meeting due on June 16-17. While 30 out of 58 respondents expected borrowing costs to remain at 0.50% in 2025, a reversal from the May poll, when the same fraction expected rates at 0.75% by end-2025.Additionally, the JPY may face challenges due to dampened safe-haven demand amid the cooling off of tariff tensions between the US and China. Traders await further developments in the US-China agreement as officials seek approval from their leaders before moving ahead with the implementation of the Geneva Consensus. US Commerce Secretary Howard Lutnick suggested that potential resolutions with China have been achieved. Meanwhile, China’s Vice Commerce Minister Li Chenggang noted that communication with the United States has been rational and candid.Market sentiment improved following the reports suggesting that Washington is considering easing semiconductor restrictions and looking for accelerated rare-earth shipments. This boosted the hope of reduced supply-chain friction, supporting global trade sentiment. Tariffs FAQs What are tariffs? Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas. What is the difference between taxes and tariffs? Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers. Are tariffs good or bad? There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs. What is US President Donald Trump’s tariff plan? During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
GBP/JPY hovers near a five-month high of 196.45, reached on Tuesday.A Reuters poll suggested that the BoJ will not increase interest rates in 2025 amid uncertainty over US tariff policy.The safe-haven JPY struggles due to easing US-China tariff tensions.GBP/JPY remains subdued for the third consecutive day, trading around 195.60 during the early European hours on Wednesday. However, the currency cross maintains its position near a five-month high of 196.45, which was recorded on Tuesday, with hopes of further gains. The Japanese Yen (JPY) faces challenges following a Reuters poll, suggesting that the Bank of Japan (BoJ) will not raise another interest rate again this year due to uncertainty over US tariff policy.Out of 60 economists who participated in the Reuters survey conducted between June 2-10, no one expected the BoJ to increase rates at its upcoming policy meeting due on June 16-17. While 30 out of 58 respondents expected borrowing costs to remain at 0.50% in 2025, a reversal from the May poll, when the same fraction expected rates at 0.75% by end-2025.Additionally, the JPY may face challenges due to dampened safe-haven demand amid the cooling off of tariff tensions between the US and China. Traders await further developments in the US-China agreement as officials seek approval from their leaders before moving ahead with the implementation of the Geneva Consensus. US Commerce Secretary Howard Lutnick suggested that potential resolutions with China have been achieved. Meanwhile, China’s Vice Commerce Minister Li Chenggang noted that communication with the United States has been rational and candid.Market sentiment improved following the reports suggesting that Washington is considering easing semiconductor restrictions and looking for accelerated rare-earth shipments. This boosted the hope of reduced supply-chain friction, supporting global trade sentiment. Tariffs FAQs What are tariffs? Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas. What is the difference between taxes and tariffs? Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers. Are tariffs good or bad? There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs. What is US President Donald Trump’s tariff plan? During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
10:47 Forex Today: US May inflation report to ramp up market volatility
Here is what you need to know on Wednesday, June 11:
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Here is what you need to know on Wednesday, June 11:The trading action in financial markets remains choppy early Wednesday as investors' search for the next catalyst continues. In the second half of the day, the US Bureau of Labor Statistics will publish the Consumer Price Index (CPI) data for May and the US Treasury will hold a 10-year note auction. US Dollar PRICE This week The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the British Pound. USD EUR GBP JPY CAD AUD NZD CHF USD -0.19% 0.36% 0.19% -0.12% -0.23% -0.23% 0.14% EUR 0.19% 0.53% 0.36% 0.06% -0.02% -0.05% 0.31% GBP -0.36% -0.53% -0.08% -0.48% -0.54% -0.58% -0.22% JPY -0.19% -0.36% 0.08% -0.30% -0.47% -0.47% -0.17% CAD 0.12% -0.06% 0.48% 0.30% -0.13% -0.11% 0.25% AUD 0.23% 0.02% 0.54% 0.47% 0.13% -0.04% 0.33% NZD 0.23% 0.05% 0.58% 0.47% 0.11% 0.04% 0.37% CHF -0.14% -0.31% 0.22% 0.17% -0.25% -0.33% -0.37% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
The US Dollar (USD) held its ground on Tuesday, with the USD Index ending the day marginally higher. Following a two-day talk, the United States (US) and China have decided to ease export curbs, including the ones on rare earths, and agreed on a framework to keep the tariff truce alive. Wall Street's main indexes registered modest gains following this development. In the meantime, Bloomberg reported late Tuesday that a federal appeals court has ruled that US President Donald Trump’s broad tariffs can remain in effect while legal appeals continue, Early Wednesday, the USD Index stays in positive territory above 99.00 and US stock index futures lose about 0.2%.Annual inflation in the US, as measured by the change in the CPI, is forecast to rise to 2.5% in May from 2.3% in April. In the same period, the core CPI is seen rising 2.9%. EUR/USD extends its sideways grind at around 1.1400 in the European morning on Wednesday after closing virtually unchanged on Tuesday.GBP/USD closed in negative territory on Tuesday as the disappointing labor market data weighed on Pound Sterling. The pair stays on the back foot and trades below 1.3500 in the early European session on Wednesday. The UK's Office for National Statistics will publish monthly Industrial Production, Manufacturing Production and Gross Domestic Product data for April on Thursday.USD/JPY registered small gains on Tuesday and erased Monday's losses. The pair edges higher on Wednesday and trades above 145.00. The data from Japan showed in the Asian session that the Producer Price Index (PPI) rose 3.2% on a yearly basis in May. This print followed the 4.1% increase reported in April and came in below the market expectation of 3.5%.After failing to make a decisive move in either direction on Monday and Tuesday, Gold stretches higher and trades in positive territory at around $3,340 in the European session on Wednesday. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
10:40 WTI Price Forecast: Oil remains bullish with downside attempts capped at $63.45
Oil prices are showing a moderate reversal on Wednesday, as the vague news about the US-China trade deal has been taken with more scepticism than enthusiasm.
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The Sino-US trade talks ended late on Tuesday with an alleged agreement to ease restrictions on rare earth’s commerce, bringing their trade relationship to the terms set in the Geneva summit last month. The deal needs to be ratified by the presidents of the US and China.Technical analysis: Crude prices keep trending higherThe US benchmark WTI’s prices remain heading higher. Tuesday’s reversal from the $65.40 area has been contained above the previous resistance area, at $63.45, which suggests that dips are finding buyers so far. The 4-hour RSI remains in positive territory above 50.
On the upside, the next bullish target is at the $65.30 - $65.60 area where the June 10 high meets the 161.8% Fibonacci extension from mid-May’s correction. Above here, the 261.8% retracement is at $69.10.
On the downside, a bearish reaction below $63.45 (June 2,3,4, and 5 highs) would bring the $62.00 area (June 5 low) to the focus.WTI 4-Hour Chart WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
The Sino-US trade talks ended late on Tuesday with an alleged agreement to ease restrictions on rare earth’s commerce, bringing their trade relationship to the terms set in the Geneva summit last month. The deal needs to be ratified by the presidents of the US and China.Technical analysis: Crude prices keep trending higherThe US benchmark WTI’s prices remain heading higher. Tuesday’s reversal from the $65.40 area has been contained above the previous resistance area, at $63.45, which suggests that dips are finding buyers so far. The 4-hour RSI remains in positive territory above 50.
On the upside, the next bullish target is at the $65.30 - $65.60 area where the June 10 high meets the 161.8% Fibonacci extension from mid-May’s correction. Above here, the 261.8% retracement is at $69.10.
On the downside, a bearish reaction below $63.45 (June 2,3,4, and 5 highs) would bring the $62.00 area (June 5 low) to the focus.WTI 4-Hour Chart WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
10:08 EU aims for US trade talks to extend past Trump’s July deadline – Bloomberg
Citing people familiar with the matter, Bloomberg reported on Wednesday that the European Union (EU) believes trade negotiations with the United States (US) to extend beyond President Donald Trump’s July 9 deadline.
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Citing people familiar with the matter, Bloomberg reported on Wednesday that the European Union (EU) believes trade negotiations with the United States (US) to extend beyond President Donald Trump’s July 9 deadline.“The US is expected to respond to the latest round of negotiations in the coming days and provide clarity on the next steps,” Bloomberg reported.The EU and US face a July 9 deadline to avert tariffs after a temporary reprieve granted by President Trump.Market reactionEUR/USD remains on the defensive following these headlines, losing 0.13% on the day to trade near 1.1410 at the press time. Tariffs FAQs What are tariffs? Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas. What is the difference between taxes and tariffs? Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers. Are tariffs good or bad? There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs. What is US President Donald Trump’s tariff plan? During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
09:56 USD/CAD trades above 1.3650 as easing US-China tensions offset impact of higher Oil prices
USD/CAD retraces its recent losses, trading around 1.3680 during the Asian hours on Wednesday. However, the upside of the USD/CAD pair could be limited as the commodity-linked Canadian Dollar (CAD) possibly receives support from the improved crude Oil prices.
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However, the upside of the USD/CAD pair could be limited as the commodity-linked Canadian Dollar (CAD) possibly receives support from the improved crude Oil prices. Higher Oil prices may provide support for the CAD as Canada is the largest crude exporter to the United States (US).West Texas Intermediate (WTI) Oil price remains above $64.00 per barrel at the time of writing. Crude Oil prices receive support from positive risk sentiment, driven by a cooling down of tariff tensions between the US and China.Moreover, traders welcomed the positive developments from the US-China discussion held in London. Reports suggest that Washington is considering easing semiconductor restrictions and looking for accelerated rare-earth shipments. This boosted hope of reduced supply-chain friction, supporting global trade sentiment and improving potential demand for Canada’s commodity-heavy export base, offering support to the CAD.However, the US Dollar (USD) also receives support from easing US-China tariff tensions, which offsets the impact of the higher crude prices, strengthening the USD/CAD pair. US Commerce Secretary Howard Lutnick suggested on Tuesday that potential resolutions with China have been achieved and both countries have reached a framework to implement the Geneva Consensus.Meanwhile, China’s Vice Commerce Minister Li Chenggang said that communication with the United States has been rational and candid, and he will report on a framework to Chinese leaders. However, officials from both sides will seek approval from their leaders before implementation, according to Bloomberg. Canadian Dollar FAQs What key factors drive the Canadian Dollar? The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar. How do the decisions of the Bank of Canada impact the Canadian Dollar? The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive. How does the price of Oil impact the Canadian Dollar? The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD. How does inflation data impact the value of the Canadian Dollar? While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar. How does economic data influence the value of the Canadian Dollar? Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
09:55 NZD/USD weakens below 0.6050 on renewed US Dollar demand, eyes on US CPI data
The NZD/USD pair attracts some sellers to around 0.6030 during the early European session on Wednesday, bolstered by renewed US Dollar (USD) demand.
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The US and China agreed on a framework to implement their trade truce. The RBNZ might slow the pace of rate cuts as uncertainty grows. The NZD/USD pair attracts some sellers to around 0.6030 during the early European session on Wednesday, bolstered by renewed US Dollar (USD) demand. Investors assess the result of trade talks between the United States and China ahead of the US May Consumer Price Index (CPI) inflation data, which will be released later on Wednesday. The Greenback edges higher after the report early Wednesday that the US and China agreed to a preliminary deal on how to implement the consensus the two sides reached in Geneva. US negotiators stated that they “absolutely expect” that issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation, even though the full details of their agreement weren’t immediately available. Analysts expect a potential trade deal between the world's two biggest economies could boost the USD broadly.Meanwhile, Wednesday’s US inflation data is expected to show US consumers probably saw slightly faster inflation in May. The headline CPI is forecast to see an increase of 2.5% YoY in May, while the core CPI is projected to see a rise of 2.9% YoY in the same period.If the report showed hotter inflation in the US, this may reinforce the Federal Reserve’s (Fed) wait-and-see stance as it assesses the impact of tariffs, with traders increasingly betting that the US central bank will cut interest rates just once this year. This, in turn, might underpin the Greenback and create a headwind for the pair in the near term.On the other hand, the rising expectation that the Reserve Bank of New Zealand (RBNZ) will slow the pace of interest rate cuts might help limit the NZD’s losses. “While the RBNZ downgraded its economic forecasts compared to February and emphasized the high degree of uncertainty around global conditions, there was a surprising amount of caution around the timing and extent of further OCR cuts,” said Westpac senior economist Michael Gordon. New Zealand Dollar FAQs What key factors drive the New Zealand Dollar? The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD. How do decisions of the RBNZ impact the New Zealand Dollar? The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair. How does economic data influence the value of the New Zealand Dollar? Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate. How does broader risk sentiment impact the New Zealand Dollar? The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
09:02 Crude Oil price today: WTI price bullish at European opening
West Texas Intermediate (WTI) Oil price advances on Wednesday, early in the European session. WTI trades at $64.11 per barrel, up from Tuesday’s close at $63.86.
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West Texas Intermediate (WTI) Oil price advances on Wednesday, early in the European session. WTI trades at $64.11 per barrel, up from Tuesday’s close at $63.86.Brent Oil Exchange Rate (Brent crude) is also up, advancing from the $66.24 price posted on Tuesday, and trading at $66.49. WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
08:55 USD/MXN remains on the defensive near 19.00 ahead of US CPI release
The USD/MXN pair remains on the defensive near 19.05 during the early European session on Wednesday. The Mexican Peso (MXN) strengthens against the US Dollar (USD), its strongest level in more than nine months, bolstered by a potential trade deal between the United States and Mexico.
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The US and Mexico discussed a deal to cut Trump's steel tariffs. Traders await the US May CPI inflation data later on Wednesday. The USD/MXN pair remains on the defensive near 19.05 during the early European session on Wednesday. The Mexican Peso (MXN) strengthens against the US Dollar (USD), its strongest level in more than nine months, bolstered by a potential trade deal between the United States and Mexico. The United States and Mexico are discussing a deal to reduce or remove US President Donald Trump's 50% steel tariffs on imports up to a certain volume, per Reuters. The agreement hasn’t been finalized, however, an industry source familiar with the talks said that it would allow US companies to import Mexican steel tariff-free as long as total shipments are kept below a level based on historical trade volumes.Traders will keep an eye on the US May Consumer Price Index (CPI) inflation data, which is due later on Wednesday. The headline CPI is expected to see an increase of 2.5% YoY in May, while the core CPI is estimated to see a rise of 2.9% YoY in the same period. If the report shows softer inflation in the US economy, this might drag the Greenback lower.On the other hand, the US Federal Reserve (Fed) will keep interest rates on hold for at least another couple of months, according to Reuters polls, citing inflation risks triggered by Trump's tariff policies. All but two of the 105 economists in the June 5-10 Reuters poll forecast that the US central bank would keep the Fed Funds Rate unchanged at its June meeting in a 4.25%-4.50% range, where it has been since the start of the year. The cautious stance of the Fed might lift the USD in the near term. Mexican Peso FAQs What key factors drive the Mexican Peso? The Mexican Peso (MXN) is the most traded currency among its Latin American peers. Its value is broadly determined by the performance of the Mexican economy, the country’s central bank’s policy, the amount of foreign investment in the country and even the levels of remittances sent by Mexicans who live abroad, particularly in the United States. Geopolitical trends can also move MXN: for example, the process of nearshoring – or the decision by some firms to relocate manufacturing capacity and supply chains closer to their home countries – is also seen as a catalyst for the Mexican currency as the country is considered a key manufacturing hub in the American continent. Another catalyst for MXN is Oil prices as Mexico is a key exporter of the commodity. How do decisions of the Banxico impact the Mexican Peso? The main objective of Mexico’s central bank, also known as Banxico, is to maintain inflation at low and stable levels (at or close to its target of 3%, the midpoint in a tolerance band of between 2% and 4%). To this end, the bank sets an appropriate level of interest rates. When inflation is too high, Banxico will attempt to tame it by raising interest rates, making it more expensive for households and businesses to borrow money, thus cooling demand and the overall economy. Higher interest rates are generally positive for the Mexican Peso (MXN) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken MXN. How does economic data influence the value of the Mexican Peso? Macroeconomic data releases are key to assess the state of the economy and can have an impact on the Mexican Peso (MXN) valuation. A strong Mexican economy, based on high economic growth, low unemployment and high confidence is good for MXN. Not only does it attract more foreign investment but it may encourage the Bank of Mexico (Banxico) to increase interest rates, particularly if this strength comes together with elevated inflation. However, if economic data is weak, MXN is likely to depreciate. How does broader risk sentiment impact the Mexican Peso? As an emerging-market currency, the Mexican Peso (MXN) tends to strive during risk-on periods, or when investors perceive that broader market risks are low and thus are eager to engage with investments that carry a higher risk. Conversely, MXN tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
08:41 EUR/GBP sits near one-month peak, comfortably above mid-0.8400s amid rising BoE rate cut bets
The EUR/GBP cross touched a one-month high, around the 0.8465-0.8470 region during the Asian session on Wednesday, though it lacks follow-through buying. The fundamental backdrop, however, suggests that the path of least resistance for spot prices is to the upside.
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The fundamental backdrop, however, suggests that the path of least resistance for spot prices is to the upside. The British Pound (GBP) continues with its relative underperformance on the back of Tuesday's disappointing UK jobs data, which lifted bets that the Bank of England (BoE) will cut interest rates twice this year. In contrast, the European Central Bank (ECB) last week signaled that the end of the rate-cutting cycle is nearing. The divergent BoE-ECB expectations turn out to be a key factor acting as a tailwind for the EUR/GBP cross.Adding to this, the previous day's breakout through a short-term trading range validates the near-term positive outlook and supports prospects for additional gains. Bullish traders, however, seem reluctant to place fresh bets and opt to wait for the release of the US consumer inflation figures, which might infuse volatility in the markets and provide a fresh impetus to the EUR/GBP cross later during the North American session.In the absence of any relevant market-moving macroeconomic data, either from the Eurozone or the UK, the constructive setup might continue to act as a tailwind for spot prices. Hence, any corrective pullback could be seen as a buying opportunity and is more likely to remain cushioned. BoE FAQs What does the Bank of England do and how does it impact the Pound? The Bank of England (BoE) decides monetary policy for the United Kingdom. Its primary goal is to achieve ‘price stability’, or a steady inflation rate of 2%. Its tool for achieving this is via the adjustment of base lending rates. The BoE sets the rate at which it lends to commercial banks and banks lend to each other, determining the level of interest rates in the economy overall. This also impacts the value of the Pound Sterling (GBP). How does the Bank of England’s monetary policy influence Sterling? When inflation is above the Bank of England’s target it responds by raising interest rates, making it more expensive for people and businesses to access credit. This is positive for the Pound Sterling because higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls below target, it is a sign economic growth is slowing, and the BoE will consider lowering interest rates to cheapen credit in the hope businesses will borrow to invest in growth-generating projects – a negative for the Pound Sterling. What is Quantitative Easing (QE) and how does it affect the Pound? In extreme situations, the Bank of England can enact a policy called Quantitative Easing (QE). QE is the process by which the BoE substantially increases the flow of credit in a stuck financial system. QE is a last resort policy when lowering interest rates will not achieve the necessary result. The process of QE involves the BoE printing money to buy assets – usually government or AAA-rated corporate bonds – from banks and other financial institutions. QE usually results in a weaker Pound Sterling. What is Quantitative tightening (QT) and how does it affect the Pound Sterling? Quantitative tightening (QT) is the reverse of QE, enacted when the economy is strengthening and inflation starts rising. Whilst in QE the Bank of England (BoE) purchases government and corporate bonds from financial institutions to encourage them to lend; in QT, the BoE stops buying more bonds, and stops reinvesting the principal maturing on the bonds it already holds. It is usually positive for the Pound Sterling.
08:28 FX option expiries for Jun 11 NY cut
FX option expiries for Jun 11 NY cut at 10:00 Eastern Time vi a DTCC can be found below.
FX option expiries for Jun 11 NY cut at 10:00 Eastern Time vi a DTCC can be found below.EUR/USD: EUR amounts1.1200 1.7b1.1300 2.9b1.1400 2.8b1.1500 2.2bGBP/USD: GBP amounts1.3450 757mUSD/JPY: USD amounts 143.00 1b14430 831m145.00 1.3bUSD/CHF: USD amounts 0.8250 440mAUD/USD: AUD amounts0.6405 462mUSD/CAD: USD amounts 1.3670 867m1.3800 650mNZD/USD: NZD amounts0.5800 778m
08:15 AUD/JPY clings to gains near 94.50 as investors doubt BoJ’s rate hike plans
The AUD/JPY pair holds onto four-day rally to near 94.50 during Asian trading hours on Wednesday. The cross exhibits strength as investors start doubting over whether the Bank of Japan (BoJ) will raise interest rates again this year.
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The cross exhibits strength as investors start doubting over whether the Bank of Japan (BoJ) will raise interest rates again this year.On Monday, Japan’s Prime Minister Shigeru Ishiba cited concerns over rising interest rates by the BoJ, warning that they could hinder Tokyo’s spending plans. The statement from PM Ishiba came at a time when the economic outlook of Japan has become uncertain due to the fallout of the tariff policy by United States (US) President Donald Trump.A Reuters poll in the June 2-10 period showed that a slight majority of economists expect the BoJ to keep interest rates steady at 0.5% by the year-end. The survey also showed that none of the economists expected the Japanese central bank to raise its key borrowing rate in the next week’s monetary policy announcement.On the contrary, BoJ Governor Kazuo Ueda has kept the door open for further tightening the interest rate policy if officials get convinced that the underlying inflation moves around 2%.”Meanwhile, the Australian Dollar (AUD) exhibits a sluggish performance even though Washington and Beijing have reached a “framework” to execute the trade deal made in Geneva last month. However, the framework is needed to be approved by both United States (US) President Donald Trump and Chinese leader XI Jinping.A positive outcome from the two-day trade talks between the US and China is favorable for the Aussie Dollar, given that the Australian economy relies heavily on its exports to Beijing. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
07:58 EUR/JPY Price Forecast: Retains bullish bias above 165.50
The EUR/JPY cross posts modest gains near 165.50 during the early European session on Tuesday. The Japanese Yen (JPY) softens against the Euro (EUR) amid the improved risk sentiment as positive developments from US-China trade talks undermine the JPY's safe-haven status.
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The cross maintains a constructive view above the 100-day EMA, with a bullish RSI indicator. The immediate resistance level is seen at 165.65; the initial support level is located at 164.55. The EUR/JPY cross posts modest gains near 165.50 during the early European session on Tuesday. The Japanese Yen (JPY) softens against the Euro (EUR) amid the improved risk sentiment as positive developments from US-China trade talks undermine the JPY's safe-haven status.Technically, EUR/JPY keeps the bullish vibe on the daily chart, with the price holding above the key 100-day Exponential Moving Average (EMA). Further upside looks favorable as the 14-day Relative Strength Index (RSI) stands above the midline near 63.50. This suggests bullish momentum in the near term. The first upside target to watch for the cross is seen at 165.65, the upper boundary of the Bollinger Band. Further north, the next hurdle is located at 166.10, the high of November 6, 2024. The additional upside filter to watch is 166.60, the high of October 30, 2024. On the other hand, the initial support level for EUR/JPY emerges at 164.55, the low of June 9. Any follow-through selling below the mentioned level could see a drop to 162.90, the low of June 5. The key contention level to watch is 162.40, the 100-day EMA. EUR/JPY Daily Chart Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
07:47 EUR/USD holds losses near 1.1400 due to easing tariff tensions between US, China
EUR/USD loses ground after registering gains in the previous two consecutive sessions, trading around 1.1400 during the Asian hours on Wednesday. The pair depreciates as the US Dollar receives support from easing tariff tensions between the United States (US) and China.
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EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy.
The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa.
The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control.
Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency.
A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall.
Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
07:42 USD/CHF Price Forecast: Consolidates below 0.8245-0.8250 horizontal barrier
The USD/CHF pair extends its consolidative price move through the Asian session on Wednesday and remains confined in a range held over the past two weeks or so amid mixed cues.
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The USD/CHF pair extends its consolidative price move through the Asian session on Wednesday and remains confined in a range held over the past two weeks or so amid mixed cues. The emergence of some US Dollar (USD) buying lends some support to spot prices, though reviving safe-haven demand acts as a headwind. Looking at the broader picture, the recent bounce from the vicinity of mid-0.8100s, or the lowest level since April 22 touched last week, has been along an upward-sloping line. This, along with a strong horizontal barrier near the 0.8245-0.8250 region, constitutes the formation of an ascending triangle on hourly charts and favors the USD/CHF bulls. However, it will be prudent to wait for a convincing breakout through the said hurdle before positioning for any further gains.Spot prices might then surpass an intermediate hurdle near the 0.8275 area and aim to reclaim the 0.8300 round figure. The momentum could extend further toward the next relevant resistance near the 0.8325-0.8330 supply zone. Some follow-through buying will suggest that the USD/CHF pair has formed a near-term bottom and pave the way for additional gains.On the flip side, the ascending trend-line support, currently pegged just above the 0.8200 mark, might continue to protect the immediate downside. This is followed by the monthly swing low, around the 0.8155 region, which if broken, will be seen as a fresh trigger for bearish traders. The subsequent downfall could drag the USD/CHF pair to the 0.8100 round figure en route to the April swing low, around the 0.8040 region, or the lowest level since September 2011.USD/CHF 4-hour chart Swiss Franc FAQs What key factors drive the Swiss Franc? The Swiss Franc (CHF) is Switzerland’s official currency. It is among the top ten most traded currencies globally, reaching volumes that well exceed the size of the Swiss economy. Its value is determined by the broad market sentiment, the country’s economic health or action taken by the Swiss National Bank (SNB), among other factors. Between 2011 and 2015, the Swiss Franc was pegged to the Euro (EUR). The peg was abruptly removed, resulting in a more than 20% increase in the Franc’s value, causing a turmoil in markets. Even though the peg isn’t in force anymore, CHF fortunes tend to be highly correlated with the Euro ones due to the high dependency of the Swiss economy on the neighboring Eurozone. Why is the Swiss Franc considered a safe-haven currency? The Swiss Franc (CHF) is considered a safe-haven asset, or a currency that investors tend to buy in times of market stress. This is due to the perceived status of Switzerland in the world: a stable economy, a strong export sector, big central bank reserves or a longstanding political stance towards neutrality in global conflicts make the country’s currency a good choice for investors fleeing from risks. Turbulent times are likely to strengthen CHF value against other currencies that are seen as more risky to invest in. How do decisions of the Swiss National Bank impact the Swiss Franc? The Swiss National Bank (SNB) meets four times a year – once every quarter, less than other major central banks – to decide on monetary policy. The bank aims for an annual inflation rate of less than 2%. When inflation is above target or forecasted to be above target in the foreseeable future, the bank will attempt to tame price growth by raising its policy rate. Higher interest rates are generally positive for the Swiss Franc (CHF) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken CHF. How does economic data influence the value of the Swiss Franc? Macroeconomic data releases in Switzerland are key to assessing the state of the economy and can impact the Swiss Franc’s (CHF) valuation. The Swiss economy is broadly stable, but any sudden change in economic growth, inflation, current account or the central bank’s currency reserves have the potential to trigger moves in CHF. Generally, high economic growth, low unemployment and high confidence are good for CHF. Conversely, if economic data points to weakening momentum, CHF is likely to depreciate. How does the Eurozone monetary policy affect the Swiss Franc? As a small and open economy, Switzerland is heavily dependent on the health of the neighboring Eurozone economies. The broader European Union is Switzerland’s main economic partner and a key political ally, so macroeconomic and monetary policy stability in the Eurozone is essential for Switzerland and, thus, for the Swiss Franc (CHF). With such dependency, some models suggest that the correlation between the fortunes of the Euro (EUR) and the CHF is more than 90%, or close to perfect.
07:36 BoJ to keep interest rates unchanged through year-end - Reuters Poll
Most economists now expect the Bank of Japan will hold interest rates through year-end, a Reuters survey showed.
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Most economists now expect the Bank of Japan will hold interest rates through year-end, a Reuters survey showed. Additional takeawaysNone of the 60 economists in the June 2-10 survey expected the BOJ to raise rates at its upcoming policy meeting on June 16-17.
52% of economists, 30 of 58, expected borrowing costs to stay at 0.50% at year-end, the reverse of a poll in May when 52% expected rates at 0.75% by end-2025.
More than three-quarters of respondents, 40 of 51, now expect at least one 25-basis-point increase by end-March, the poll showed.
Of 35 economists who specified a month for when the BOJ will next hike rates, January 2025 was the top choice at 37%, followed by 23% for October this year and 9% saying March 2025.
The BOJ exited a massive stimulus program in March last year and pushed up short-term interest rates to 0.25% in July and 0.50% in January.
Just over half of respondents, 17 of 31, said the BOJ would decelerate its pace of tapering JGB purchases from the current roughly 400 billion yen per quarter beyond April next year.
Of those respondents, the quarterly taper size prediction ranged from 200 billion yen to 370 billion yen.
Three-quarters of economists, 21 of 28, said the government would trim the issuance of super-long bonds while the rest said the amount would not change.Japan's government (not BoJ) issuance of super-long JGBs to decrease, say 75% of economists, 25% say no change. Market reactionAt the time of writing, the USD/JPY pair is trading 0.11% higher on the day at 145.00. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
52% of economists, 30 of 58, expected borrowing costs to stay at 0.50% at year-end, the reverse of a poll in May when 52% expected rates at 0.75% by end-2025.
More than three-quarters of respondents, 40 of 51, now expect at least one 25-basis-point increase by end-March, the poll showed.
Of 35 economists who specified a month for when the BOJ will next hike rates, January 2025 was the top choice at 37%, followed by 23% for October this year and 9% saying March 2025.
The BOJ exited a massive stimulus program in March last year and pushed up short-term interest rates to 0.25% in July and 0.50% in January.
Just over half of respondents, 17 of 31, said the BOJ would decelerate its pace of tapering JGB purchases from the current roughly 400 billion yen per quarter beyond April next year.
Of those respondents, the quarterly taper size prediction ranged from 200 billion yen to 370 billion yen.
Three-quarters of economists, 21 of 28, said the government would trim the issuance of super-long bonds while the rest said the amount would not change.Japan's government (not BoJ) issuance of super-long JGBs to decrease, say 75% of economists, 25% say no change. Market reactionAt the time of writing, the USD/JPY pair is trading 0.11% higher on the day at 145.00. Japanese Yen FAQs What key factors drive the Japanese Yen? The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors. How do the decisions of the Bank of Japan impact the Japanese Yen? One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The BoJ ultra-loose monetary policy between 2013 and 2024 caused the Yen to depreciate against its main currency peers due to an increasing policy divergence between the Bank of Japan and other main central banks. More recently, the gradually unwinding of this ultra-loose policy has given some support to the Yen. How does the differential between Japanese and US bond yields impact the Japanese Yen? Over the last decade, the BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supported a widening of the differential between the 10-year US and Japanese bonds, which favored the US Dollar against the Japanese Yen. The BoJ decision in 2024 to gradually abandon the ultra-loose policy, coupled with interest-rate cuts in other major central banks, is narrowing this differential. How does broader risk sentiment impact the Japanese Yen? The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.
07:35 India Gold price today: Gold rises, according to FXStreet data
Gold prices rose in India on Wednesday, according to data compiled by FXStreet.
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Gold prices rose in India on Wednesday, according to data compiled by FXStreet.
The price for Gold stood at 9,179.94 Indian Rupees (INR) per gram, up compared with the INR 9,132.11 it cost on Tuesday.
The price for Gold increased to INR 107,073.10 per tola from INR 106,515.10 per tola a day earlier. Unit measure Gold Price in INR 1 Gram 9,179.94 10 Grams 91,798.06 Tola 107,073.10 Troy Ounce 285,534.30
2025 Gold Forecast Guide [PDF] Download your free copy of the 2025 Gold Forecast
Daily Digest Market Movers: Gold price benefits from a favorable update on Trump’s tariffs US President Donald Trump received a favorable update on Tuesday as a federal appeals court ruled that his “Liberation Day” tariffs can temporarily stay in effect. Last month, the US Court of International Trade blocked the implementation of Trump's tariffs, saying that the method used to enact them was unlawful. The latest development comes as the US and China, following two days of talks in London, agreed on a framework to implement the Geneva Consensus and ease trade tensions. US Commerce Secretary Howard Lutnick indicated the deal should resolve issues between the two countries surrounding rare earths and magnets. Russia continues with its strikes on Ukraine’s northeastern city of Kharkiv after rejecting an unconditional ceasefire earlier this month. Moreover, Israel continues to bombard the Gaza Strip relentlessly, keeping geopolitical risks in play and driving safe-haven flows toward the Gold price on Wednesday. The stronger-than-expected US Nonfarm Payrolls report released last Friday pointed to a still resilient labor market, forcing investors to scale back their bets for an imminent interest rate cut by the Federal Reserve. Markets, however, are still pricing in the possibility of two rate reductions by the end of this year. The US Dollar, however, remains confined to a familiar range, just above its lowest level since April 22, which it touched last week, as investors await more cues about the Fed's rate-cut path. Hence, the focus remains glued to the release of the US Consumer Price Index (CPI) report later during the North American session. This will be followed by the US Producer Price Index (PPI) on Thursday, which will play a key role in influencing the near-term USD price dynamics and provide some meaningful impetus to the commodity. In the meantime, the supportive fundamental backdrop should act as a tailwind for the XAU/USD. FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.
Gold FAQs Why do people invest in Gold?
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold?
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets?
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on?
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up. (An automation tool was used in creating this post.)
07:30 USD/INR refreshes weekly low even as US-China signals to ease export controls
The Indian Rupee (INR) posts a fresh weekly high near 85.47 against the US Dollar (USD) in the opening session on Wednesday. The US Dollar trades calmly after the White House signaled a positive outcome from the two-day meeting between trade negotiators from the United States and China in London.
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The US Dollar trades calmly after the White House signaled a positive outcome from the two-day meeting between trade negotiators from the United States and China in London. The US Dollar Index (DXY), which gauges the Greenback’s value against six major currencies, ticks up to near 99.15.US Secretary of Commerce Howard Lutnick told reporters that both nations reached a “framework” to implement the trade deal made in Geneva in May, if approved by President Donald Trump. Lutnick expressed confidence that China would curb non-tariff barriers on the export of “rare earth and magnets”, and Washington would also roll back export restrictions on sophisticated chips.Meanwhile, the Chinese ministry has also expressed a positive outcome from trade talks with Washington and stated that the agreement will now be forwarded to President Xi Jinping for approval.The US Dollar trades steadily after the US-China trade agreement, which was expected to perform strongly on de-escalation in trade tensions between the two nations. Analysts at National Australia Bank stated that the “devil is going to be in the details and importantly whether this can help to reestablish trust between President Xi and President Trump, which has clearly been broken since the Geneva Agreement was published”.On the legislative front, the US Federal Appeals court has stated that tariffs imposed by Donald Trump relating to border negligence and those announced on so-called “Liberation Day” on April 2 will remain in effect until they get proven whether they are permissible under the emergency act or not. The next argument regarding the sustainability of the above-mentioned tariffs will take place on July 31.Daily digest market movers: Indian Rupee appreciates against US Dollar ahead of US inflation dataThe Indian Rupee extends its winning streak for the fifth straight trading day on Wednesday against the US Dollar ahead of the US Consumer Price Index (CPI) data for May, which will be published at 12:30 GMT. The US CPI report is expected to show that the headline inflation rose at a faster pace of 2.5% year-on-year, compared to a 2.3% growth seen in April. In the same period, the core CPI – which excludes volatile food and energy prices – accelerated to 2.9% from the prior reading of 2.8%. On month, the headline and the core CPI rose by 0.2% and 0.3% respectively.The scenario of high inflation growth would limit Federal Reserve (Fed) policymakers from lowering interest rates. However, soft inflation figures are unlikely to prompt officials to endorse early interest rate cuts, assuming they are more focused on stabilizing de-anchored consumer inflation expectations, fuelled by the implementation of new economic policies by US President Trump.According to the CME FedWatch tool, the Fed will not reduce interest rates in the June and July policy meetings.In the Asian region, strong foreign inflows and a likely decline in the Oil price has strengthened the Indian Rupee. On Tuesday, the data from Indian exchanges showed that Foreign Institutional Investors (FIIs) were net buyers, pumping Rs 2,301.87 crore into equity markets.Meanwhile, the US Energy Information Administration (EIA) cites demand concerns and rising output as factors that could lead to a decline in the international benchmark Brent crude to $61/bbl by the end of 2025. Lower Oil prices bode well for the INR, given that India is one of the world's leading importers.On the economic front, investors await the release of the Indian CPI data for May, scheduled for Thursday. Inflationary pressures are expected to have risen by 3% year-on-year, slower than the 3.16% growth seen in April.Signs of cooling price pressures would prompt market expectations that the Reserve Bank of India (RBI) could reduce interest rates again. In last week’s policy meeting, the RBI unexpectedly slashed the Repo Rate by 50 basis points (bps) to 5.5% and guided little room for further monetary policy expansion.Technical Analysis: USD/INR struggles to hold 20-day EMAThe USD/INR pair refreshes the weekly low near 85.47 during Asian trading hours on Wednesday. The outlook of the pair is uncertain as it struggles to hold the 20-day Exponential Moving Average (EMA), which trades around 85.49.The 14-day Relative Strength Index (RSI) hovers inside the 40.00-60.00 range, indicating a sideways trend.Looking down, the June 3 low of 85.30 is a key support level for the major. A downside break below the same could expose it to the May 26 low of 84.78. On the upside, the pair could revisit an over 11-week high around 86.70 after breaking above the May 22 high of 86.10. Indian Rupee FAQs What are the key factors driving the Indian Rupee? The Indian Rupee (INR) is one of the most sensitive currencies to external factors. The price of Crude Oil (the country is highly dependent on imported Oil), the value of the US Dollar – most trade is conducted in USD – and the level of foreign investment, are all influential. Direct intervention by the Reserve Bank of India (RBI) in FX markets to keep the exchange rate stable, as well as the level of interest rates set by the RBI, are further major influencing factors on the Rupee. How do the decisions of the Reserve Bank of India impact the Indian Rupee? The Reserve Bank of India (RBI) actively intervenes in forex markets to maintain a stable exchange rate, to help facilitate trade. In addition, the RBI tries to maintain the inflation rate at its 4% target by adjusting interest rates. Higher interest rates usually strengthen the Rupee. This is due to the role of the ‘carry trade’ in which investors borrow in countries with lower interest rates so as to place their money in countries’ offering relatively higher interest rates and profit from the difference. What macroeconomic factors influence the value of the Indian Rupee? Macroeconomic factors that influence the value of the Rupee include inflation, interest rates, the economic growth rate (GDP), the balance of trade, and inflows from foreign investment. A higher growth rate can lead to more overseas investment, pushing up demand for the Rupee. A less negative balance of trade will eventually lead to a stronger Rupee. Higher interest rates, especially real rates (interest rates less inflation) are also positive for the Rupee. A risk-on environment can lead to greater inflows of Foreign Direct and Indirect Investment (FDI and FII), which also benefit the Rupee. How does inflation impact the Indian Rupee? Higher inflation, particularly, if it is comparatively higher than India’s peers, is generally negative for the currency as it reflects devaluation through oversupply. Inflation also increases the cost of exports, leading to more Rupees being sold to purchase foreign imports, which is Rupee-negative. At the same time, higher inflation usually leads to the Reserve Bank of India (RBI) raising interest rates and this can be positive for the Rupee, due to increased demand from international investors. The opposite effect is true of lower inflation.
07:15 Gold price climbs closer to overnight swing high despite trade optimism, firmer USD
Gold price (XAU/USD) attracts fresh buyers during the Asian session on Wednesday and climbs back above the $3,340 level in the last hour, closer to the weekly high touched the previous day.
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A modest USD strength might cap the XAU/USD ahead of the critical US inflation figures.Gold price (XAU/USD) attracts fresh buyers during the Asian session on Wednesday and climbs back above the $3,340 level in the last hour, closer to the weekly high touched the previous day. A federal appeals court ruled on Tuesday that US President Donald Trump's sweeping tariffs can temporarily stay in effect, adding another twist to the trade saga. This, along with rising geopolitical tensions, is a key factor underpinning demand for the safe-haven commodity. Apart from this, the growing acceptance that the Federal Reserve (Fed) would step in to support the economy and slash rates in September further benefits the non-yielding Gold price. Meanwhile, a positive outcome from the high-stakes US-China trade talks boosts investors' confidence, as evident in the upbeat market mood. Moreover, a modest US Dollar (USD) uptick is holding back traders from placing aggressive bullish bets around the XAU/USD and capping the upside. Daily Digest Market Movers: Gold price benefits from a favorable update on Trump’s tariffsUS President Donald Trump received a favorable update on Tuesday as a federal appeals court ruled that his “Liberation Day” tariffs can temporarily stay in effect. Last month, the US Court of International Trade blocked the implementation of Trump's tariffs, saying that the method used to enact them was unlawful.The latest development comes as the US and China, following two days of talks in London, agreed on a framework to implement the Geneva Consensus and ease trade tensions. US Commerce Secretary Howard Lutnick indicated the deal should resolve issues between the two countries surrounding rare earths and magnets. Russia continues with its strikes on Ukraine’s northeastern city of Kharkiv after rejecting an unconditional ceasefire earlier this month. Moreover, Israel continues to bombard the Gaza Strip relentlessly, keeping geopolitical risks in play and driving safe-haven flows toward the Gold price on Wednesday. The stronger-than-expected US Nonfarm Payrolls report released last Friday pointed to a still resilient labor market, forcing investors to scale back their bets for an imminent interest rate cut by the Federal Reserve. Markets, however, are still pricing in the possibility of two rate reductions by the end of this year. The US Dollar, however, remains confined to a familiar range, just above its lowest level since April 22, which it touched last week, as investors await more cues about the Fed's rate-cut path. Hence, the focus remains glued to the release of the US Consumer Price Index (CPI) report later during the North American session. This will be followed by the US Producer Price Index (PPI) on Thursday, which will play a key role in influencing the near-term USD price dynamics and provide some meaningful impetus to the commodity. In the meantime, the supportive fundamental backdrop should act as a tailwind for the XAU/USD. Gold price could accelerate the positive move once the $3,352-3,353 barrier is cleared decisivelyFrom a technical perspective, the overnight bounce from the vicinity of the 200-period Simple Moving Average (SMA) on the 4-hour chart and the subsequent move up favor the XAU/USD bulls. Adding to this, oscillators on the said chart have again started gaining positive traction and back the case for further intraday move-up. A further strength beyond the $3,352-3,353 immediate hurdle will reaffirm the bullish outlook and lift the Gold price towards the $3,377-3,378 intermediate hurdle en route to the $3,400 round figure. On the flip side, weakness back below the $3,323-3,322 area might continue to attract some buyers and find decent support near the $3,300 round figure. Some follow-through selling, leading to a subsequent fall below the $3,288-3,287 zone (200-period SMA on the 4-hour chart), might shift the bias in favor of bearish traders and drag the Gold price to the monthly swing low, around the $3,245 region. The XAU/USD could extend the corrective decline further and eventually drop to the $3,200 neighborhood. Tariffs FAQs What are tariffs? Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas. What is the difference between taxes and tariffs? Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers. Are tariffs good or bad? There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs. What is US President Donald Trump’s tariff plan? During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
06:58 US Dollar Index stays above 99.00 ahead of US CPI data
The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is extending its gains for the second successive day and trading higher at around 99.10 during the Asian hours on Wednesday.
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06:52 GBP/USD extends downside below 1.3500 ahead of US CPI release
The GBP/USD pair extends the decline to around 1.3475 during the Asian trading hours on Wednesday. The Pound Sterling (GBP) weakens against the US Dollar (USD) due to a weaker UK employment report. Later on Wednesday, the attention will shift to the US May Consumer Price Index (CPI) inflation.
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Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates.
When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money.
When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP.
A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
06:00 US CPI data set to show mild inflation as markets assess tariff impact
The Consumer Price Index (CPI) data for May is expected to highlight a pickup in inflation in the United States (US).
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.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The US Consumer Price Index is expected to rise 2.5% YoY in May, at a stronger pace than it did in April.The annual core CPI inflation is forecast to tick up to 2.9%.May’s inflation data could impact the Fed’s policy outlook, rocking the US Dollar.The Consumer Price Index (CPI) data for May is expected to highlight a pickup in inflation in the United States (US). Investors will scrutinize the details of the report to see whether US President Donald Trump’s new tariff regime is ramping up price pressures, which could have significant implications for the Federal Reserve’s (Fed) policy outlook.The US Bureau of Labor Statistics is due to publish the CPI data for May on Wednesday at 12:30 GMT. The immediate market reaction could drive the US Dollar’s (USD) valuation. What to expect in the next CPI data report?As measured by the change in the CPI, inflation in the US is forecast to rise at an annual rate of 2.5% in May, at a stronger rate than the 2.3% increase recorded in April. The core CPI inflation, which excludes the volatile food and energy categories, is expected to rise 2.9% YoY, against the 2.8% growth reported in the previous month.On a monthly basis, the CPI and the core CPI are projected to rise by 0.2% and 0.3%, respectively.Previewing the report, analysts at TD Securities said: “Core CPI inflation likely stayed unchanged in May, posting a 0.23% m/m increase. We expect still soft travel services prices to keep the series under control, as signs of tariffs pass-through start to emerge.”“Headline CPI inflation likely lost speed, owing partly to a large retreat in gas prices. We pencil in headline and core CPI inflation at 2.4% and 2.9% y/y, respectively,” they added. Related news NY Fed: Year-ahead expected inflation falls to 3.2% in May from 3.6% in April Three fundamentals for the week: Investors eye trade talks and US inflation, consumer sentiment data Last week, ambiguous payrolls – This week, semi-ambiguous CPI
How could the US Consumer Price Index report affect EUR/USD?Inflation data for May could influence the market pricing of the Fed’s rate outlook and impact the USD’s performance in the short term. At its May policy meeting, the Fed kept the federal funds rate unchanged in the range of 4.25% to 4.50%. Comments from Fed officials since then highlighted that policymakers are willing to remain patient in regard to policy-easing, unless there is a significant downturn in the labor market outlook. “I see greater upside risks to inflation and potential downside risks to employment and output growth,” Fed Board of Governor member Adriana Kugler said. Meanwhile, Chicago Fed President Austan Goolsbee noted that they must wait and see if tariffs have a big or a small impact on inflation before taking a policy step.The latest employment report from the US showed that Nonfarm Payrolls rose by 139,000 in May, surpassing the market expectation of 130,000. The CME Group FedWatch Tool’s probability of a 25 basis points (bps) rate cut in July dropped below 20% after this data from about 30% earlier in the week, suggesting that markets assessed the labor market as healthy enough for the Fed to delay its rate cut.A significant upside surprise in the monthly core CPI reading, which is not distorted by base effects, could boost the USD with an immediate reaction and weigh on EUR/USD because such a reading could feed into expectations of the Fed lowering the policy rate just once this year. Conversely, a print below 0.2% in this data could ease concerns that inflation will remain sticky in the second half of the year because of tariffs and hurt the USD. In this scenario, EUR/USD could gather bullish momentum.Eren Sengezer, European Session Lead Analyst at FXStreet, offers a brief technical outlook for EUR/USD and explains:“The Relative Strength Index (RSI) indicator on the daily chart holds above 50 but moves sideways, suggesting that the bullish bias remains intact, while lacking momentum.”“On the upside, the immediate resistance level is located at 1.1575 (April 21 high, mid-point of the four-month-old ascending regression channel) before 1.1700 (static level, round level) and 1.1860 (upper limit of the ascending channel). Alternatively, the 20-day Simple Moving Average (SMA) at 1.1320 could be seen as the first support ahead of 1.1250 (Fibonacci 23.6% retracement of the uptrend, lower limit of the ascending channel) and 1.1060 (Fibonacci 38.2% retracement).” Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it.
Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.
05:47 Silver Price Forecast: XAG/USD maintains position above $36.50 near 13-year highs
Silver price (XAG/USD) holds ground after registering over a 0.50% loss in the previous session, trading around $36.60 per troy ounce during the Asian hours on Wednesday. The price of the grey metal maintains a position near a 13-year high of $36.89, which was reached on Monday.
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Silver price remains close to a 13-year high of $36.89, which was marked on Monday.The safe-haven Silver may struggle amid easing US-China trade tensions.Officials from the US and China reached potential resolutions but are awaiting approvals from their leaders.Silver price (XAG/USD) holds ground after registering over a 0.50% loss in the previous session, trading around $36.60 per troy ounce during the Asian hours on Wednesday. The price of the grey metal maintains a position near a 13-year high of $36.89, which was reached on Monday. The US Consumer Price Index (CPI) data will be closely watched later in the North American session, with expectations of a 2.5% year-over-year (YoY) rise in May.However, precious metals, including Silver, may face challenges due to dampened safe-haven demand amid easing trade tensions between the United States (US) and China. On Tuesday, US Commerce Secretary Howard Lutnick indicated potential resolutions with China. Lutnick also said that both countries have reached a framework to implement the Geneva Consensus.US negotiators also expect the issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation. While China’s Vice Commerce Minister Li Chenggang called the communication with the US counterparts rational and candid, he will report on a framework to Chinese leaders. Officials from both sides will seek approval from their leaders before implementation.On Tuesday, in its twice-yearly Global Economic Prospects report, the World Bank downgraded its global growth forecast for 2025 by 0.4% to 2.3%, highlighting that higher tariffs and heightened uncertainty posed a significant threat for nearly all economies. The global lender slashed its forecasts for nearly 70% of all economies. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
Silver price remains close to a 13-year high of $36.89, which was marked on Monday.The safe-haven Silver may struggle amid easing US-China trade tensions.Officials from the US and China reached potential resolutions but are awaiting approvals from their leaders.Silver price (XAG/USD) holds ground after registering over a 0.50% loss in the previous session, trading around $36.60 per troy ounce during the Asian hours on Wednesday. The price of the grey metal maintains a position near a 13-year high of $36.89, which was reached on Monday. The US Consumer Price Index (CPI) data will be closely watched later in the North American session, with expectations of a 2.5% year-over-year (YoY) rise in May.However, precious metals, including Silver, may face challenges due to dampened safe-haven demand amid easing trade tensions between the United States (US) and China. On Tuesday, US Commerce Secretary Howard Lutnick indicated potential resolutions with China. Lutnick also said that both countries have reached a framework to implement the Geneva Consensus.US negotiators also expect the issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation. While China’s Vice Commerce Minister Li Chenggang called the communication with the US counterparts rational and candid, he will report on a framework to Chinese leaders. Officials from both sides will seek approval from their leaders before implementation.On Tuesday, in its twice-yearly Global Economic Prospects report, the World Bank downgraded its global growth forecast for 2025 by 0.4% to 2.3%, highlighting that higher tariffs and heightened uncertainty posed a significant threat for nearly all economies. The global lender slashed its forecasts for nearly 70% of all economies. Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.
05:24 Japanese Yen hangs near two-week low against a slightly firmer USD
The Japanese Yen (JPY) remains close to a nearly two-week low touched against its American counterpart the previous day, though any further decline seems elusive.
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A modest USD uptick lends additional support to USD/JPY, though the upside seems capped. The divergent BoJ-Fed policy expectations might continue to act as a headwind for the pair. The Japanese Yen (JPY) remains close to a nearly two-week low touched against its American counterpart the previous day, though any further decline seems elusive. The latest optimism over a positive outcome from US-China trade talks is seen as a key factor undermining the traditional safe-haven status of the JPY. Adding to this, a modest US Dollar (USD) uptick lifts the USD/JPY pair back above the 145.00 psychological mark during the Asian session on Wednesday. However, a combination of factors should help limit deeper JPY losses. A federal appeals court ruled that US President Donald Trump’s tariffs can remain in effect while legal appeals continue. This adds to a layer of uncertainty in the markets, which, along with bets that the Bank of Japan (BoJ) will continue raising interest rates, should act as a tailwind for the JPY. Moreover, dovish Federal Reserve (Fed) expectations should cap the Greenback and the USD/JPY pair. Japanese Yen bulls remain on the defensive despite hawkish BoJ expectationsInvestors turned cautious after a federal appeals court ruled that US President Donald Trump's “Liberation Day” tariffs on most trading partners could remain in effect while it reviewed a lower court decision to block them. The court, however, is yet to rule on whether the tariffs are permissible under an emergency economic powers act that Trump cited to justify them.Data released last week showed that Japan's economy contracted less than initially estimated during the first quarter. Adding to this, signs of broadening inflation in Japan back the case for further policy normalization by the Bank of Japan. This continues to act as a tailwind for the Japanese Yen, though the optimism over US-China trade talks keeps bulls on the defensive.China’s Vice Commerce Minister Li Chenggang told reporters that the Chinese and the US negotiators have agreed on a framework for trade after two days of talks in London. US Commerce Secretary Howard Lutnick said that the framework was the first step to eliminate the negativity, and the implementation plan should result in the resolution of rare earth and magnet issues.The optimism stemming from the positive outcome of the crucial US-China trade talks remains supportive of a generally upbeat tone in the equity markets. It undermines the safe-haven status of the JPY. Moreover, signs of easing tensions between the world's two largest economies assist the US Dollar to attract some buyers and further act as a tailwind for the USD/JPY pair. Traders pared their bets that the Federal Reserve will cut interest rates in the next few months following the release of the US Nonfarm Payrolls (NFP) report on Friday, which pointed to a resilient labor market. Traders, however, are still pricing in around 0.45% of easing by the year-end, marking a significant divergence in comparison to hawkish BoJ expectations. Traders now look forward to the release of the US Consumer Price Index (CPI), which is forecast to show a pickup that may reinforce the Fed’s wait-and-see stance toward further easing. Nevertheless, the crucial data will be scrutinized for cues about the Fed's rate-cut path, which, in turn, will influence the USD price dynamics and provide a fresh impetus. USD/JPY seems poised to climb further while above the 200-period SMA on H4From a technical perspective, acceptance above the 100-period Simple Moving Average (SMA) and positive oscillators on daily/hourly charts favor the USD/JPY bulls. However, repeated failures to build on momentum beyond the 145.00 psychological mark make it prudent to wait for some follow-through buying beyond the 145.30 area, or a two-week top touched on Tuesday, before positioning for further gains. Spot prices might then surpass the 145.60-145.65 intermediate hurdle and aim to reclaim the 146.00 round figure before climbing further towards the 146.25-146.30 region, or May 29 swing high. On the flip side, the 200-period SMA on the 4-hour chart, currently pegged near the 144.30 area, might now protect the immediate downside ahead of the 144.00 mark. A convincing break below the latter will negate the positive outlook and shift the near-term bias in favor of the USD/JPY bears. The subsequent decline could drag spot prices down to the 143.60-143.50 region en route to sub-143.00 levels. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
05:13 Australian Dollar loses ground as US Dollar advances amid improving US-China dialogue
The Australian Dollar (AUD) declines against the US Dollar (USD) on Wednesday, retracing its recent gains. However, the AUD/USD pair may gain ground amid easing trade tensions between the United States (US) and China.
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The Australian Dollar (AUD) declines against the US Dollar (USD) on Wednesday, retracing its recent gains. However, the AUD/USD pair may gain ground amid easing trade tensions between the United States (US) and China. Any economic change in China could impact AUD as China and Australia are close trade partners.US Commerce Secretary Howard Lutnick indicated potential resolutions with China. On Tuesday, Lutnick noted that the US and China have reached a framework to implement the Geneva Consensus and are now seeking approval from US President Donald Trump, according to Bloomberg.US negotiators also noted that they “absolutely expect” the issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation. While China’s Vice Commerce Minister Li Chenggang said that communication with the United States has been rational and candid, he will report on a framework to Chinese leaders.Australian Dollar edges lower despite easing US-China tariff tensionsThe US Dollar Index (DXY), which measures the value of the US Dollar against six major currencies, is extending its gains for the second successive day and trading higher at around 99.10 at the time of writing. The US Consumer Price Index (CPI) inflation will be closely watched on Wednesday, with expectations of a 2.5% year-over-year (YoY) rise in May.The US Court of Appeals for the Federal Circuit extended an earlier, temporary respite on Tuesday for the government as it presses a challenge to a lower court ruling last month that blocked the tariffs. The federal appeals court has ruled that President Trump’s broad tariffs can remain in effect while legal appeals continue, per Bloomberg.The US Bureau of Labor Statistics (BLS) reported that US Nonfarm Payrolls (NFP) rose by 139,000 in May compared to the 147,000 increase (revised from 177,000) in April. This reading came in above the market consensus of 130,000. Moreover, the Unemployment Rate held steady at 4.2%, and the Average Hourly Earnings remained unchanged at 3.9%, both readings came in stronger than the market expectation.US President Donald Trump called upon, in a post published on Truth Social on Wednesday, Federal Reserve (Fed) Chairman Jerome Powell to lower the policy rate. "ADP NUMBER OUT!!! “Too Late” Powell must now LOWER THE RATE. He is unbelievable!!! Europe has lowered NINE TIMES," Trump said.The National Bureau of Statistics of China reported that the Consumer Price Index (CPI) dropped at an annual pace of 0.1% in May, following April’s 0.1% decline. However, the market consensus was for a 0.2% decrease in the reported period. Meanwhile, China’s CPI inflation declined by 0.2% MoM, against April’s 0.1% increase. China’s Producer Price Index (PPI) continues to weaken with an annual decline of 3.3% in May, following a 2.7% decline in April.China's Trade Balance (CNY) arrived at CNY743.56 billion in May, expanding from the previous surplus of CNY689.99 billion. Meanwhile, Exports rose 6.3% YoY against 9.3% in April. The country’s imports fell 2.1% YoY in the same period, from a 0.8% rise recorded previously.Australia’s Trade Balance posted a 5,413M surplus month-over-month in April, below the 6,100M expected and 6,892M (revised from 6,900M) in the previous reading. Exports declined by 2.4% MoM in April, against a 7.2% rise prior (revised from 7.6%). Meanwhile, Imports rose by 1.1%, compared to a decline of 2.4% (revised from -2.2%) seen in March. China’s Caixin Services PMI rose to 51.1 in May as expected, from 50.7 in April.Australian Dollar tests 0.6500 support near nine-day EMA AUD/USD trading around 0.6510 on Wednesday. The daily chart’s technical analysis indicates a prevailing bullish bias as the pair remains within the ascending channel pattern. Moreover, the pair stays above the nine-day Exponential Moving Average (EMA), suggesting a stronger short-term price momentum. The 14-day Relative Strength Index (RSI) is also remaining above the 50 mark, indicating a bullish bias.The AUD/USD pair may target an immediate barrier at a seven-month high of 0.6538, which was reached on June 5. Further advances could prompt the pair to explore the region around the eight-month high at 0.6687, aligned with the upper boundary of the ascending channel around 0.6710.On the downside, the initial support appears at the nine-day EMA of 0.6492, aligned with the ascending channel’s lower boundary around 0.6480. A break below this crucial support zone could weaken the bullish bias and lead the AUD/USD pair to test the 50-day EMA at 0.6416.AUD/USD: Daily Chart Australian Dollar PRICE Today The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the weakest against the US Dollar. USD EUR GBP JPY CAD AUD NZD CHF USD 0.10% 0.14% 0.10% 0.05% 0.26% 0.30% 0.04% EUR -0.10% 0.03% 0.00% -0.08% 0.14% 0.15% -0.07% GBP -0.14% -0.03% -0.06% -0.08% 0.13% 0.13% -0.11% JPY -0.10% 0.00% 0.06% -0.15% 0.17% 0.19% -0.08% CAD -0.05% 0.08% 0.08% 0.15% 0.24% 0.23% -0.04% AUD -0.26% -0.14% -0.13% -0.17% -0.24% 0.00% -0.22% NZD -0.30% -0.15% -0.13% -0.19% -0.23% -0.01% -0.24% CHF -0.04% 0.07% 0.11% 0.08% 0.04% 0.22% 0.24% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote). Australian Dollar FAQs What key factors drive the Australian Dollar? One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar? The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar? China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar? Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar? The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.
04:59 WTI attracts some buyers above $63.50 on optimism around US-China trade talks
West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $63.80 during the Asian trading hours on Wednesday. The WTI price edges higher as traders digest the result of trade talks between the United States and China.
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US crude oil inventories unexpectedly declined in the week ended June 6, according to the API.West Texas Intermediate (WTI), the US crude oil benchmark, is trading around $63.80 during the Asian trading hours on Wednesday. The WTI price edges higher as traders digest the result of trade talks between the United States and China. The US May Consumer Price Index (CPI) inflation and the EIA Crude Oil stockpiles report will be the highlights later on Wednesday. Bloomberg reported early Wednesday that the US and China agreed to a preliminary deal on how to implement the consensus the two sides reached in Geneva. US negotiators stated that they “absolutely expect” that issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation, even though the full details of their agreement weren’t immediately available. Analysts expect a trade deal between the world's two biggest economies could underpin the WTI price by boosting global economic growth and increasing oil demand.The American Petroleum Institute (API) weekly report showed crude oil stockpiles in the US for the week ending June 6 declined by 370,000 barrels, compared to a fall of 3.3 million barrels in the previous week. The market consensus estimated that stocks would increase by 700,000 barrels.On the other hand, Iran said it would soon make a counter-proposal for a nuclear deal in response to a US offer that Tehran deems "unacceptable," per Reuters. Any signs of easing US sanctions on Tehran should allow Iran to export more oil, which might cap the upside for the crude prices. WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
04:47 OPEC Secretary General says oil demand growth to continue, no peak in sight
OPEC Secretary General Haitham Al Ghais said on Tuesday that oil demand growth will remain robust over the next two and a half decades as the world population grows, per Reuters.
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OPEC Secretary General Haitham Al Ghais said on Tuesday that oil demand growth will remain robust over the next two and a half decades as the world population grows, per Reuters. OPEC estimates a 24% growth in global energy consumption between now and 2050, with oil demand exceeding 120 million barrels per day over that time period. That projection is in line with the group's 2024 World Oil Outlook.Market reactionAt the time of press, the WTI price was up 0.17% on the day at $63.95. WTI Oil FAQs What is WTI Oil? WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media. What factors drive the price of WTI Oil? Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa. How does inventory data impact the price of WTI Oil The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency. How does OPEC influence the price of WTI Oil? OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
04:15 PBOC sets USD/CNY reference rate at 7.1815 vs. 7.1840 previous
On Wednesday, the People’s Bank of China (PBOC) set the USD/CNY central rate for the trading session ahead at 7.1815 as compared to the previous day's fix of 7.1840 and 7.1801 Reuters estimate.
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On Wednesday, the People’s Bank of China (PBOC) set the USD/CNY central rate for the trading session ahead at 7.1815 as compared to the previous day's fix of 7.1840 and 7.1801 Reuters estimate. PBOC FAQs What does the People's Bank of China do? The primary monetary policy objectives of the People's Bank of China (PBoC) are to safeguard price stability, including exchange rate stability, and promote economic growth. China’s central bank also aims to implement financial reforms, such as opening and developing the financial market. Who owns the PBoC? The PBoC is owned by the state of the People's Republic of China (PRC), so it is not considered an autonomous institution. The Chinese Communist Party (CCP) Committee Secretary, nominated by the Chairman of the State Council, has a key influence on the PBoC’s management and direction, not the governor. However, Mr. Pan Gongsheng currently holds both of these posts. What are the main policy tools used by the PBoC? Unlike the Western economies, the PBoC uses a broader set of monetary policy instruments to achieve its objectives. The primary tools include a seven-day Reverse Repo Rate (RRR), Medium-term Lending Facility (MLF), foreign exchange interventions and Reserve Requirement Ratio (RRR). However, The Loan Prime Rate (LPR) is China’s benchmark interest rate. Changes to the LPR directly influence the rates that need to be paid in the market for loans and mortgages and the interest paid on savings. By changing the LPR, China’s central bank can also influence the exchange rates of the Chinese Renminbi. Are private banks allowed in China? Yes, China has 19 private banks – a small fraction of the financial system. The largest private banks are digital lenders WeBank and MYbank, which are backed by tech giants Tencent and Ant Group, per The Straits Times. In 2014, China allowed domestic lenders fully capitalized by private funds to operate in the state-dominated financial sector.
03:59 US appeals court allows US President Donald Trump tariffs to stay in place - Bloomberg
A federal appeals court has ruled that US President Donald Trump’s broad tariffs can remain in effect while legal appeals continue, per Bloomberg.
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A federal appeals court has ruled that US President Donald Trump’s broad tariffs can remain in effect while legal appeals continue, per Bloomberg. The order announced Tuesday by the US Court of Appeals for the Federal Circuit extends an earlier, temporary respite for the government as it presses a challenge to a lower court ruling last month that blocked the tariffs. The Justice Department said that US officials' worries about current trade talks outweighed the economic damage alleged by the small businesses that sued.Market reactionAt the time of press, the US Dollar Index was up 0.01% on the day at 99.05. Tariffs FAQs What are tariffs? Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas. What is the difference between taxes and tariffs? Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers. Are tariffs good or bad? There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs. What is US President Donald Trump’s tariff plan? During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
03:37 US, China officials agree on plan to ease trade tensions - Bloomberg
The United States (US) and China agreed to a preliminary deal on how to implement the consensus the two sides reached in Geneva, per Bloomberg.
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The United States (US) and China agreed to a preliminary deal on how to implement the consensus the two sides reached in Geneva, per Bloomberg.US negotiators said early Wednesday that they “absolutely expect” that issues around shipments of rare earth minerals and magnets will be resolved with the framework implementation, even though the full details of their deal weren’t immediately available.Market reactionAt the time of press, the US Dollar Index was down 0.06% on the day at 99.0. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
03:26 USD/CAD flat lines above 1.3650 as investors track US-China trade talk progress, US CPI data
The USD/CAD pair holds steady near 1.3670 during the early Asian session on Wednesday. Easing trade tension between the United States (US) and China could underpin the US Dollar (USD). Investors will closely monitor the result of the US-China trade talks.
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A potential US-China trade deal could provide some support to the US Dollar. The BoC held the key rate steady but says a future cut is possible.The USD/CAD pair holds steady near 1.3670 during the early Asian session on Wednesday. Easing trade tension between the United States (US) and China could underpin the US Dollar (USD). Investors will closely monitor the result of the US-China trade talks. Also, the US May Consumer Price Index (CPI) data will take center stage later on Wednesday. US Commerce Secretary Howard Lutnick hinted at potential resolutions with China. Lutnick said late Tuesday that the US and China have reached a framework to implement the Geneva Consensus, but they will go back and see if US President Donald Trump approves it. Positive developments surrounding US-China negotiations could stabilize global markets and lift the Greenback. The Bank of Canada (BoC) held its key benchmark rate at 2.75% last week, citing US trade policy uncertainty. However, BoC policymakers noted that another rate cut might be necessary if the economy weakened in the face of tariffs. Economists expect two or three additional reductions from the BoC this year, and the final rate by the end of the year would likely end at around 2%. This, in turn, could weigh on the Canadian Dollar (CAD) and act as a tailwind for the pair. Meanwhile, a rise in Crude Oil prices might boost the commodity-linked Loonie. It’s worth noting that Canada is the largest oil exporter to the US, and higher crude oil prices tend to have a positive impact on the CAD value. Canadian Dollar FAQs What key factors drive the Canadian Dollar? The key factors driving the Canadian Dollar (CAD) are the level of interest rates set by the Bank of Canada (BoC), the price of Oil, Canada’s largest export, the health of its economy, inflation and the Trade Balance, which is the difference between the value of Canada’s exports versus its imports. Other factors include market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe-havens (risk-off) – with risk-on being CAD-positive. As its largest trading partner, the health of the US economy is also a key factor influencing the Canadian Dollar. How do the decisions of the Bank of Canada impact the Canadian Dollar? The Bank of Canada (BoC) has a significant influence on the Canadian Dollar by setting the level of interest rates that banks can lend to one another. This influences the level of interest rates for everyone. The main goal of the BoC is to maintain inflation at 1-3% by adjusting interest rates up or down. Relatively higher interest rates tend to be positive for the CAD. The Bank of Canada can also use quantitative easing and tightening to influence credit conditions, with the former CAD-negative and the latter CAD-positive. How does the price of Oil impact the Canadian Dollar? The price of Oil is a key factor impacting the value of the Canadian Dollar. Petroleum is Canada’s biggest export, so Oil price tends to have an immediate impact on the CAD value. Generally, if Oil price rises CAD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Oil falls. Higher Oil prices also tend to result in a greater likelihood of a positive Trade Balance, which is also supportive of the CAD. How does inflation data impact the value of the Canadian Dollar? While inflation had always traditionally been thought of as a negative factor for a currency since it lowers the value of money, the opposite has actually been the case in modern times with the relaxation of cross-border capital controls. Higher inflation tends to lead central banks to put up interest rates which attracts more capital inflows from global investors seeking a lucrative place to keep their money. This increases demand for the local currency, which in Canada’s case is the Canadian Dollar. How does economic data influence the value of the Canadian Dollar? Macroeconomic data releases gauge the health of the economy and can have an impact on the Canadian Dollar. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the CAD. A strong economy is good for the Canadian Dollar. Not only does it attract more foreign investment but it may encourage the Bank of Canada to put up interest rates, leading to a stronger currency. If economic data is weak, however, the CAD is likely to fall.
02:50 Japan Producer Price Index (MoM) fell from previous 0.2% to -0.2% in May
Japan Producer Price Index (MoM) fell from previous 0.2% to -0.2% in May
02:50 Japan Producer Price Index (YoY) registered at 3.2%, below expectations (3.5%) in May
Japan Producer Price Index (YoY) registered at 3.2%, below expectations (3.5%) in May
02:34 US Commerce Secretary Lutnick says reached a framework with China
US Commerce Secretary Howard Lutnick said early Wednesday that the United States and China have reached a framework to implement the Geneva Consensus, but they will go back and see if US President Donald Trump approves it.
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US Commerce Secretary Howard Lutnick said early Wednesday that the United States and China have reached a framework to implement the Geneva Consensus, but they will go back and see if US President Donald Trump approves it. Key quotesWe have reached a framework to implement the Geneva Consensus.
Combined the Geneva Consensus with the outcome of the leaders' call on June 5.
We’re going to go back and see if Trump approves it.
If approved, we’ll implement it.
Says Xi and Trump's call changed the outcome.
The idea behind all this is to increase our trade with China.
The framework is the first step, we had to get the negativity out.
We expect that rare earth and magnets issues will be resolved in this.
When they approve the licenses then you should expect our export implementation to come down again.Market reaction At the time of writing, the AUD/USD pair is trading 0.09% higher on the day at 0.6527. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
Combined the Geneva Consensus with the outcome of the leaders' call on June 5.
We’re going to go back and see if Trump approves it.
If approved, we’ll implement it.
Says Xi and Trump's call changed the outcome.
The idea behind all this is to increase our trade with China.
The framework is the first step, we had to get the negativity out.
We expect that rare earth and magnets issues will be resolved in this.
When they approve the licenses then you should expect our export implementation to come down again.Market reaction At the time of writing, the AUD/USD pair is trading 0.09% higher on the day at 0.6527. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
02:27 China’s Vice Commerce Minister says talks with US on trade rational and candid
China’s Vice Commerce Minister Li Chenggang said early Wednesday that communication with the United States (US) has been rational and candid, adding that the two sides agreed on a consensus on the Geneva meeting.
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China’s Vice Commerce Minister Li Chenggang said early Wednesday that communication with the United States (US) has been rational and candid, adding that the two sides agreed on a consensus on the Geneva meeting. Key quotesTalks with the US had involved in-depth exchanges.
Communication has been rational and candid.
Two sides agreed on a consensus at the Geneva meeting.
Will report on a framework to Leaders.
Hope Progress Here is conducive to increasing Trust Between China and the US.
Hope this injects positive Energy into World Economic Development.
Our communication has been professional, rational, in-depth and candid.
We hope progress achieved in London talks can be conducive for enhancing trust.Market reaction At the time of writing, the AUD/USD pair is trading 0.09% higher on the day at 0.6527. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
Communication has been rational and candid.
Two sides agreed on a consensus at the Geneva meeting.
Will report on a framework to Leaders.
Hope Progress Here is conducive to increasing Trust Between China and the US.
Hope this injects positive Energy into World Economic Development.
Our communication has been professional, rational, in-depth and candid.
We hope progress achieved in London talks can be conducive for enhancing trust.Market reaction At the time of writing, the AUD/USD pair is trading 0.09% higher on the day at 0.6527. US-China Trade War FAQs What does “trade war” mean? Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living. What is the US-China trade war? An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies. Trade war 2.0 The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.
02:15 NZD/USD strengthens to near 0.6050 as traders await outcome of US-China trade talk
The NZD/USD pair trades in positive territory near 0.6055 during the early Asian session on Wednesday. Hopes that trade talks between the United States (US) and China were going well provide some support to the China-proxy New Zealand Dollar (NZD).
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Deepening deflation risk in China could weigh on the New Zealand Dollar. The NZD/USD pair trades in positive territory near 0.6055 during the early Asian session on Wednesday. Hopes that trade talks between the United States (US) and China were going well provide some support to the China-proxy New Zealand Dollar (NZD). The US Consumer Price Index (CPI) inflation data for May will take center stage later on Wednesday. Investors await the outcome of trade policy talks between the US and China, the world’s two largest economies. US Commerce Secretary Howard Lutnick said that the US and China have reached a framework to implement the Geneva Consensus, but they will go back and see if US President Donald Trump approves itTrump commented earlier this week that China is “not easy,” but the US is “doing well” in the negotiations. Optimism surrounding US-China negotiations underpins the China-proxy Kiwi, as China is a major trading partner of New Zealand.Traders will take more cues from the US CPI inflation report on Wednesday. The headline CPI is expected to see an increase of 2.5% YoY in May, while the core CPI is estimated to see a rise of 2.9% YoY in the same period. This report could offer some hints about further insight into the US economy. “Ultimately this report is not expected to cause any significant changes to the Fed’s current wait-and-see approach when it comes to setting rates,” said Sam Millette, director of fixed income at Commonwealth Financial Network. China's producer deflation deepened to its worst level in 22 months, while consumer prices extended their decline, weighing on the NZD. China’s CPI dropped at an annual pace of 0.1% in May after declining 0.1% in April, the National Bureau of Statistics of China reported on Monday. The market consensus was for a 0.2% decrease in the reported period. Meanwhile, PPI fell 3.3% YoY in May, following a 2.7% decline in April. The data came in lower than the market consensus of 3.2%. New Zealand Dollar FAQs What key factors drive the New Zealand Dollar? The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD. How do decisions of the RBNZ impact the New Zealand Dollar? The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair. How does economic data influence the value of the New Zealand Dollar? Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate. How does broader risk sentiment impact the New Zealand Dollar? The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.
02:00 South Korea Unemployment Rate unchanged at 2.7% in May
South Korea Unemployment Rate unchanged at 2.7% in May
01:39 GBP/USD softens after UK data miss, US CPI still in the barrel
GBP/USD took a step lower on Tuesday, falling under the weight of a wide miss in UK wages and unemployment figures. US Consumer Price Index (CPI) inflation data is in the barrel for Wednesday, and Cable traders are set to grapple with mid-tier UK trade data later in the week.
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Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
01:18 AUD/JPY Price Forecast: Extends rally, eyes break above 95.00
The AUD/JPY advances for the fifth straight trading session, up by a modest 0.04% as Wednesday’s Asian session begins.
.fxs-major-currency-prices-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left}.fxs-major-currency-prices-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-major-currency-prices-content{color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:8px 16px}table.fxs-major-currency-prices-currency-prices-table{width:100%;text-align:center;border-collapse:collapse;font-size:1rem}table.fxs-major-currency-prices-currency-prices-table th{background-color:#f2f2f2}table.fxs-major-currency-prices-currency-prices-table td{color:#fff}table.fxs-major-currency-prices-currency-prices-table td.green{background-color:#9cd6cd}table.fxs-major-currency-prices-currency-prices-table td.red{background-color:#faafb5}table.fxs-major-currency-prices-currency-prices-table td.blue-grey{background-color:#888a93}.fxs-major-currency-prices-currency-prices-legend{font-size:11px;margin:8px;color:#49494f}@media (min-width:680px){.fxs-major-currency-prices-content{font-size:16px;line-height:21.6px}.fxs-major-currency-prices-title{font-size:19.2px;line-height:27.2px}}.fxs-major-currency-prices-currency-price td.dark-green{background-color:#39ad9a}.fxs-major-currency-prices-currency-price td.light-green{background-color:#9cd6cd}.fxs-major-currency-prices-currency-price td.gray{background-color:#888a93}.fxs-major-currency-prices-currency-price td.light-red{background-color:#faafb5}.fxs-major-currency-prices-currency-price td.strong-red{background-color:#f55e6a}AUD/JPY advances for fifth straight day, up 0.04% in early Asia.Pair tests descending trendline from 2024 highs, aided by bullish RSI.Break above 95.00 targets 95.63 and February high of 97.32.Support seen at 94.00, with key levels at 93.46 (Senkou Span B) and 93.29 (Tenkan-sen).The AUD/JPY advances for the fifth straight trading session, up by a modest 0.04% as Wednesday’s Asian session begins. On Tuesday, the pair bounced off daily lows of 93.88 and posted gains of over 0.33%, closing the day near the actual price at 94.50, fueled by an improvement in risk appetite, as US-China talks extended for another day.AUD/JPY Price Forecast: Technical outlookAUD/JPY appears to be testing a downslope resistance trendline drawn from the November 2024 highs, which intersects the May 13 high of 95.63, and buyers seem poised to clear it. It should be noted that the Relative Strength Index (RSI) is bullish and trending upward, indicating that buyers are gaining momentum.If bulls clear the 95.00 figure, the next area of interest would be the May 13 peak ahead of 96.00. A breach of the latter will expose the February 12 high of 97.32, followed by the 98.00 mark.On the contrary, a drop below 94.00 exposes the Senkou Span B at 93.46, followed by the Tenkan-sen at 93.29 ahead of 93.00.AUD/JPY Price Chart – Daily
Australian Dollar PRICE This week The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the British Pound. USD EUR GBP JPY CAD AUD NZD CHF USD -0.28% 0.19% 0.00% -0.16% -0.42% -0.56% 0.11% EUR 0.28% 0.45% 0.26% 0.11% -0.12% -0.30% 0.37% GBP -0.19% -0.45% -0.12% -0.35% -0.56% -0.75% -0.08% JPY 0.00% -0.26% 0.12% -0.15% -0.47% -0.62% -0.01% CAD 0.16% -0.11% 0.35% 0.15% -0.28% -0.41% 0.27% AUD 0.42% 0.12% 0.56% 0.47% 0.28% -0.18% 0.50% NZD 0.56% 0.30% 0.75% 0.62% 0.41% 0.18% 0.68% CHF -0.11% -0.37% 0.08% 0.00% -0.27% -0.50% -0.68% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
Australian Dollar PRICE This week The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies this week. Australian Dollar was the strongest against the British Pound. USD EUR GBP JPY CAD AUD NZD CHF USD -0.28% 0.19% 0.00% -0.16% -0.42% -0.56% 0.11% EUR 0.28% 0.45% 0.26% 0.11% -0.12% -0.30% 0.37% GBP -0.19% -0.45% -0.12% -0.35% -0.56% -0.75% -0.08% JPY 0.00% -0.26% 0.12% -0.15% -0.47% -0.62% -0.01% CAD 0.16% -0.11% 0.35% 0.15% -0.28% -0.41% 0.27% AUD 0.42% 0.12% 0.56% 0.47% 0.28% -0.18% 0.50% NZD 0.56% 0.30% 0.75% 0.62% 0.41% 0.18% 0.68% CHF -0.11% -0.37% 0.08% 0.00% -0.27% -0.50% -0.68% The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).
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