Daily Market review - June 2
US 10-year bond yields still moved above 1.60% and helped the U.S. dollar index regain yesterday`s loss. Currently, it is trading at 89.90, 0.4% higher than yesterday`s low, following increasing U.S. data and despite dovish FED comments.
The market is still mixed and deceptive between U.S. upbeat data and FOMC members` emphasis on dovish tone. Yesterday, "Fed Governor Randal Quarles said he does not think the bank should use its tools to counter supply chain issues." (Reuters)
Today started with decreased final GDP number in Australia to 1.8% in first-quarter, down from initial 3.1%, better than 1.5% estimates. Also, German retail sales fell -5.5% in April, from a 7.7% increase in March. Later today, we are waiting for significant speeches. RBA Assist Gov Debelle, BoE Gov Bailey, German Buba President Weidmann, ECB President Lagarde, and evening, Bostic and Brinard from FED due to speak today. They will be crucial, as the market participants will find the central bank`s comments about Inflation and future monetary policy decisions.
In the currency market and non-US major currencies, Euro was lowering and gave up yesterday`s two-week high.
GBP- The recent "exponential growth" in mutated virus infections may become a hidden risk to the British economic recovery. From its 3-year high, Cable fall by 0.75% to 1.4140.
Yen- USD gain moderately to 109.74 against the yen, as USD is getting its strong back ahead of expected positive NFP numbers.
NZD- The New Zealand dollar was under short pressure against the U.S. dollar at 0.7255.
AUD- The Reserve Bank of Australia reiterated that it is unlikely to raise interest rates before 2024, and it helped the Aussie gain over 0.3% at 0.7752. Still, with today`s stronger USD, Aussie is in the weaker position and back foot.
CAD- The U.S. dollar against the Canadian dollar broke a short-term low since May 18 (1.2006) and then rose by more than 70 points to 1.2080.
Gold- As the U.S. dollar index and U.S. Treasury yields rebounded moderately, XAUUSD recorded a decline of about $16 from the high point to $1,900 per ounce.
Silver- XAGUSD first rose after upbeat data and then fell and closed at $27.84 per ounce, following a stronger dollar.
Oil- U.S. crude oil continued its rally after the OPEC meeting and once surpassed the annual high ($68.79). However, it falls before closing to $67.68/barrel and currently trading at $67.80/barrel.
