What to watch for on Thursday, June 9:
Trading was choppy across the currency board, with most of the major pairs holding at known levels, except for the USD/JPY pair, which rose to a fresh 20-year high of 134.47. The imbalance between the US Federal Reserve and the Bank of Japan boosted the pair, as the Bank of Japan reaffirmed its decision to maintain ultra-dovish monetary policy.
The US dollar suffered early in the US session as government bond yields tightened, and subsequently recovered some ground amid the slide in US equities. Wall Street accelerated its slide in closing hours of trading after White House spokeswoman Karine Jean-Pierre said they expect inflation figures to be released later in the week to be high.
The EUR/USD pair is trading around 1.0710, while the GBP/USD is trading at 1.2540. The Canadian dollar was the best performer as the price of crude oil soared. The USD/CAD pair is trading around 1.2550 as WTI broke above $122 per barrel. The AUD/USD pair gave way and settled just below 0.7200.
Gold advanced for the second day in a row, but gains were tepid. The shiny metal is currently changing hands at $1,853 a troy ounce.
On Thursday, the focus will be on the European Central Bank. The ECB will announce the end of its stimulus program and keep interest rates unchanged, while hinting at a rate hike in July, which is a two-step lag behind most central banks. European policymakers have hinted at a 50 basis point rate hike, but President Christine Lagarde is leaning towards a conservative 25 basis point hike. Markets are choppy ahead of the event and ahead of the new US inflation numbers.
Source: Fx Street
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