What you need to know on Thursday, May 27:
The US dollar was lower at the start of the day, but ended up with gains against most of its main rivals. Stocks ranged between gains and losses while U.S. government bond yields remained low, somehow indicating that speculative interest is finally taking note of comments from Federal Reserve officials. US, indicating that they will maintain current monetary policy, despite rising inflation.
The dollar benefited from some profit taking and position adjustments on another mild macro day ahead of the US durable goods orders report due out Thursday.
The EUR / USD pair peaked at 1.2260 but settled just below 1.2100. European Central Bank board member Fabio Panetta said he sees no signs that inflation is rising and that it is premature to withdraw stimulus measures.
The pound fell further against the dollar, but the pair held above 1.4100. China has become the UK’s largest import market for the first time since the records began, overtaking Germany. Products imported from China have risen 66% from the beginning of 2018, according to the Office for National Statistics.
Commodity-linked currencies fell sharply against the dollar. Gold fell from 1,912.70 its highest level since last January. The metal trimmed most of its intraday gains before the close, staying above 1,900.
Crude prices ended the day unchanged, caught between an improvement in demand outlook and a sharp drop in US inventories, which fell 1.7 million barrels in the week ending May 21.
The focus now shifts to US durable goods orders, to be released this Thursday.
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