This is what you need to know to trade today Thursday June 9:
Markets remain quiet early on Thursday and major currency pairs continue to fluctuate in known ranges ahead of the expected monetary policy announcement from the European Central Bank (ECB). ECB President Christine Lagarde will deliver her policy outlook speech and answer questions starting at 12:30 GMT. The US Department of Labor is to release weekly jobless claims, which will be the only highlight on the US economic calendar later in the day.
The ECB is expected to announce the end of its Asset Purchase Program (APP) and confirm a rate hike in July. As for the ECB meeting, “the central bank’s economic projections will be the subject of attention as the July rate hike is already on the cards,” said Dhwani Mehta, an analyst at FXStreet. “Amid looming recession risks, rising energy costs and supply chain crisis, a downgrade of eurozone growth estimates will not be welcomed by the market if the ECB raises their inflation forecasts.
See: ECB Preview: Laying groundwork for rate hike, but EUR/USD could still fall
The dollar index trades sideways near 102.50 for the third day in a row on Thursday and the benchmark 10-year US Treasury yield remains comfortably above 3%. US stock index futures trade with small losses at the start of the European session, pointing to a cautious market environment. Earlier in the day, the city of Beijing reportedly suspended the operation of all entertainment venues in the Chaoyang district from Thursday due to an outbreak of COVID.
Meanwhile, the US Treasury Secretary, Janet Yellen reiterated that the administration of US President Joe Biden is studying the possibility of imposing tariffs on Chinese products in a more “strategic” way., but this comment had little impact on risk sentiment. During the Asian session, data from China revealed that the trade surplus widened to $78.76 billion in the 12 months to May from $55.12 billion. This data far exceeded market expectations of 58,000 million dollars. Furthermore, Chinese exports rose 15.3% last month, versus analysts’ forecast of 3.1%.
The EUR/USD rallied as high as 1.0750 on Wednesday, but ended up closing the day unchanged near 1.0720. The pair is trading higher and lower in a tight range near that level early on Thursday.
See: ECB Preview: Buy the July Rumor, Sell the Fact and Three Other EUR/USD Scenarios
The GBP/USD dipped on Wednesday after a two-day bounce and remains quiet above 1.2500 in European morning Thursday.
The USD/JPY turned down and fell below 134.00 after hitting its highest level in two decades on Wednesday at 134.54. The head of the International Monetary Fund (IMF) mission in Japan, Ranil Salgado, said earlier in the day that the weakness of the Japanese yen would help the Bank of Japan to reach its inflation target, but it would also have a negative impact on households.
The Prayed it failed to make a decisive move in either direction on Wednesday and closed flat near $1,850. XAU/USD continues its sideways move near that level despite rising US Treasury yields.
The Bitcoin lost 3% on Wednesday but manages to hold above the key $30,000 level. The ethereum It is still trading near $1,800 after recording small losses in the previous two days.
Source: Fx Street
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