What to watch for on Thursday, August 4:
Tensions eased a bit on Wednesday, sending the greenback lower across the currency board ahead of the US open. However, the dollar regained its poise following the release of an upbeat ISM services PMI, which indicated that the local economy remains resilient.
US indices rose, curbing safe-haven demand for the dollar, helped in part by strong earnings reports and encouraging local data.
Meanwhile, different US Federal Reserve officials reinforce market speculation that the Fed is far from done with aggressive tightening, putting a 75 basis point rate hike back on the table for September.
Recession fears keep the US Treasury yield curve inverted, with the spread between 2-year and 10-year Treasury yields widening to 36 basis points. However, Wall Street managed to post solid gains, helped by another round of strong earnings reports.
The EUR/USD pair traded around 1.0160 as tepid European data undermined demand for the shared currency. The GBP/USD pair ended the day lower at 1.2145.
By contrast, commodity-linked currencies benefited from strength on Wall Street. AUD/USD is trading around 0.6950, while USD/CAD is slightly lower at 1.2840.
The price of gold settled at $1,765 a troy ounce, while crude oil prices fell, as different OPEC+ sources suggest that they will not increase production. Additionally, weekly US data showed a slowdown in demand. WTI ended the day at $90.90 a barrel.
The Bank of England will announce its monetary policy decision on Thursday.
Source: Fx Street
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.
