History repeating itself

6 June, 2016

The US employment report pretty much knocked the chance of a June FOMC rate hike out of the field. As I suggested last month, June has turned out to be September of last year, where the Fed laid the groundwork for a rate increase, only to be undermined by the underlying economy. Of course, it’s not a done deal yet, but the probability of a hike this month has fallen from around 25% to below 5% on the back of the jobs data. The dollar naturally retrenched, with losses most pronounced against the South African Rand, Brazilian Real and the single currency. The only currency that finds itself weaker against the dollar is the British pound, which fell at the start of Asia trade as the latest EU referendum poll (released Friday) showed gains for those supporting an exit. Cable finds itself one big figure lower as a result, currently flirting with the 1.44 level.

Against this backdrop, the speech by Fed Chair Yellen later today will be the main event pre-occupying markets. The emphasis is likely to remain on the data dependence of any future rate moves, but naturally markets will be sensitive to any hints around the summer (most notably July). Yellen aside, the data calendar remains on the light side today, so majors are likely to be trading relatively cautiously ahead of the 16:30 GMT speech. The equity reaction to Friday’s data was very telling, the market struggling to get excited about the continuation of low rates, instead focusing on the weaker economy. This is another sign that monetary policy is losing its impact on markets.


Source link  
Oil hits 3-month lows

On Monday, the dynamics of oil was in the spotlight on a combination of negative factors by both the potential demand and the supply part. Asian markets...

Fed Monetary Policy Report to be released

This report is release twice a year and provides an insight into the conduct of monetary policy and economic developments and prospects for the future for the...

The Pound continues to weaken

Cable (GBPUSD) took a hit yesterday as Boris Johnson resigned from the Cabinet following the earlier decision by David Davis to part ways...


The latest Brexit proposals

The UK's Brexit Secretary David Davis has resigned along with two junior ministers, Steve Baker and Suella Braverman, over PM May's latest softer Brexit proposals...

Some ECB members want earlier rate hike

The markets remain subdued after yesterday's 4th of July celebrations in the US. Despite this Oil headlines are dominating the markets once again. US President Trump...

Gold has played out as a double top

The gold chart has played out as a double top with a break under 1300.00 signalling a move down to 1240.00 from its highs at 1365.00. We have now hit the 1240.00...


Gold chart has played out as a double top

The gold chart has played out as a double top with a break under 1300.00 signalling a move down to 1240.00 from its highs at 1365.00. We have now reached...

President Xi warns of Full Scale Trade War

Risk on sentiment returned briefly yesterday as markets retraced some of Monday’s selloff but sentiment in Asia has declined overnight. The PBOC cut...

USD extend losses in risk adverse markets

Stock markets fell hard yesterday as trade tensions deepened and the consequences of such action has investors worried. US Company Harley Davidson...


In the past 24 hours Bitcoin has gained 1.73% and reached $7450.99. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has lost -0.3727% and is now at $1.1646. Start trading and making money on Forex today.

In the past 7 days Ethereum has gained 4.74% and is now at $465.182. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Daily Forex Market Reviews


Forex Currencies Forecasts


Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets90%
2FXTMFXTM88%
3HYCMHYCM86%
4FIBO GroupFIBO Group79%
5FxProFxPro78%
6FXCMFXCM73%
7AvaTradeAvaTrade69%
8HotForexHotForex68%
9XMXM68%
10Alfa-ForexAlfa-Forex66%
  


Share: