Forex Today: High-Level EU and US Data Will Increase Volatility

This is what you need to know to trade today thursday june 1:

Despite the markets’ optimism, the US dollar (USD) maintains its bullish momentum in the second half of the week. Eurostat will release inflation figures for May during the European session and the European Central Bank will publish the minutes of the monetary policy meeting of May. In the second half of the day, ADP employment change for May, weekly initial jobless claims data from the US Department of Labor, and the ISM PMI Manufacturing survey will figure on the US economic agenda.

See: ADP Jobs and ISM Manufacturing PMI Preview: First Up, Then Down for Dollar?

The US Dollar DXY Index hit its highest level since mid-March on Wednesday, above 104.50, after the US Bureau of Labor Statistics (BLS) reported that the number of job offers on the last business day of April stood at 10.1 million, compared to 9.74 million in March and the 9.37 million expected by the market. For his part, the Federal Reserve noted in its Beige Book that there was little change in overall economic activity in April and early May. “Prices rose moderately during the reference period, although the rate of increase slowed down in many districts,” the publication also read.

Investors breathed a sigh of relief late on Wednesday after the House of Representatives will pass a bill to suspend the debt limit until January 1, 2025. The DXY Index pulled back from daily highs following this event, but closed in positive territory. Elsewhere, the major US stock indices, which closed before the vote, posted losses, while the benchmark 10-year US Treasury yield managed to recover towards 3.7%. As of early Thursday, US stock index futures are trading flat, while the 10-year yield is hovering near 3.7%. It is also worth noting that Philadelphia Federal Reserve (Fed) President Patrick Harker and Fed Governor Philip Jefferson on Wednesday were in favor of no rate hike at the next meeting. However, these comments do not seem to have a negative impact on the dollar’s valuation at the moment.

Pressured by broad USD strength, the EUR/USD continues to trade lower below 1.0700 on Thursday. The annual Harmonized Index of Consumer Prices (IPCA) is expected to increase by 6.3% in the Eurozone in Maycompared to the 7% increase registered in April.

After having closed the first three days of the week in positive territory, the GBP/USD it has lost traction and started to stretch lower towards 1.2400 early in the European session.

He USD/JPY regained traction on Thursday and advanced towards 140.00. Data from Japan revealed earlier in the day that Capital Spending increased 11% in the first quarterwell above market expectations of an increase of 5.5%.

The price of Gold it broke above $1,970 on Wednesday but erased much of its daily gains before closing slightly above $1,960. XAU/USD remains under modest bearish pressure in the European morning and is trading near the $1,955 area.

He Bitcoin It continues lower on Thursday, losing 1.5% on the day, around the $26,800 level. He ethereum it lost more than 1% on Wednesday and extends its decline towards $1,850 early Thursday.