This is what you need to know to trade today Wednesday June 22:
Dollar Takes Advantage of Safe Haven Money Flows early on Wednesday and strengthens against its main rivals. FOMC Chairman, Jerome Powell, will testify before the US Senate Banking Committee at a hearing entitled “The Semiannual Monetary Policy Report to Congress.” The European economic calendar will feature preliminary data from the European Commission’s consumer confidence index for June and Statistics Canada will publish the May inflation report.
According to Bloomberg, Citigroup economists now see a near 50% chance that the world economy will enter a recession. For his part, the president of the Richmond Fed, Thomas Barkis, stated that he does not expect the US economy to experience the stable growth of the last decade, at least for the next two years. Reflecting the risk-off market environment, US stock index futures are down 1.2% and 1.4% at the start of the European session, and the dollar index is up 0.4% at 104.83.
The USD/JPY hit a new multi-decade high on Tuesday, as rising US Treasury yields propelled the pair higher. Earlier in the day, minutes from the latest Bank of Japan (BoJ) monetary policy meeting showed that the board members agreed that there was no need to change the bank’s position to take additional easing measures without hesitation if necessary. USD/JPY remains relatively calm near 136.50 early on Wednesday.
The GBP/USD stays lower and falls towards 1.2200 in the European morning. Data released by the UK’s Office for National Statistics on Wednesday showed that annual inflation, as measured by the consumer price index CPI rose to 9.1% in May from 9% in April. However, the core CPI fell to 5.9% from 6.2% in the same period and prompted investors to reassess the Bank of England’s rate outlook.
Pressured by the renewed strength of the dollar, the EUR/USD pulled back below 1.0500 in the early stages of the European session. The member of the Governing Council of the European Central Bank (ECB), Olli Rehn, declared on Tuesday that he was very likely that the ECB will raise its official interest rate by more than 25 basis points in September. The positive impact of these comments on the common currency faded as markets turned risk averse midway through the week.
On Tuesday, the Prayed closed for the third day in a row in negative territory, while the 10-year US Treasury bond yield posted slight gains. XAU/USD trades with modest losses just below $1,830 early on Wednesday.
The Bitcoin it has lost its recovery momentum and is now falling towards $20,000. The ethereum It has already lost more than 4% on the day and is trading below $1,100.
Source: Fx Street
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