This is what you need to know to trade today Thursday July 7:
The dollar continued to outperform its rivals and the DXY index rose on Wednesday to its highest level in almost two decades above 107.00 before entering a consolidation phase early on Thursday. Market sentiment appears to be improving in the European morning, with US stock index futures posting modest daily gains. Later in the session, the European Central Bank (ECB) will publish the minutes of its June monetary policy meeting. Weekly data on initial jobless claims and trade balance figures for May will be released on the US economic docket. Notably, ADP has announced that it will suspend its report on private employment while it reviews the methodology. During US trading hours, various FOMC policymakers will deliver speeches.
The Fed Monetary Policy Meeting Minutes June showed that participants “agreed” that high inflation justified “restrictive” interest rates, with the possibility of adopting a “more restrictive stance” if inflation persists.
Meanwhile, Shanghai is expected to enter a new coronavirus-related lockdown as the city’s Health Commission has reported 32 new cases. Additionally, Japanese media have reported that the authorities were planning to tighten restrictions in Tokyo.
The EUR/USD it lost nearly 100 points on Wednesday and hit a multi-decade low at 1.0161. The pair is staging a modest rebound towards 1.0200 in the early European session. Earlier in the day, data from Germany showed iIndustrial production grew 0.2% in May, below market expectations of 0.4%.
The GBP/USD is having a hard time erasing its losses and remains relatively calm near 1.1950 amid the ongoing political drama in the UK. The Conservative Party’s 1922 Committee will reportedly hold an internal election to appoint a new executive, who will be able to decide whether to change the grace period rules following the vote of no confidence.
The Prayed it fell to its lowest level since September 2021, at $1,731. Rising recession fears and broad dollar strength weigh on gold demand prospects. XAU/USD last traded in positive territory above $1,740.
The USD/JPY struggling to find direction on Thursday and still moving sideways near 136.00. Despite the 10-year US Treasury bond yield gaining more than 4% on Wednesday, the pair failed to capitalize on safe-haven demand for the yen.
Bitcoin it gained 2% on Wednesday and appears to have settled above $20,000 for the time being. ethereum consolidates Wednesday’s recovery gains and fluctuates above $1,100.
Source: Fx Street
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