This is what you need to know to trade today Wednesday February 23:
The positive impact of moderating fears over a military conflict between Russia and Ukraine on risk sentiment faded in the second half on Tuesday as the US introduced sanctions against Russia. Wall Street’s major indices closed the day in negative territory and the 10-year US Treasury yield fell for the fourth day in a row. Markets remain relatively calm early on Wednesday as investors remain focused on geopolitics. Wednesday’s economic calendar will not feature any high-impact data releases.
Early on Wednesday, market mood remains moderately optimistic with US equity futures indices rising between 0.15% and 0.25%. The US dollar index, which closed little changed near 96.00 for the second day in a row on Tuesday, continues to move sideways. Atlanta Fed President Raphael Bostic said late Tuesday that they were unsure how sanctions against Russia would affect economic activity. “The Fed needs to get out of the emergency policy stance and can do so without jeopardizing jobs,” Bostic added, but these comments failed to provoke a notable market reaction.
The NZD/USD It is trading at its highest level in a month above 0.6770 buoyed by the hawkish policy outlook from the Reserve Bank of New Zealand (RBNZ). As expected, the RBNZ raised its Official Cash Rate (OCR), by 25 basis points to 1% and RBNZ Governor Adrian Orr said they cannot rule out rate hikes of 50 basis points in the future. “The amount of adjustment through the bond sale is very small, it’s all about OCR,” Orr added.
The EUR/USD trades in a relatively tight range above 1.1300 early Wednesday despite upbeat comments from European Central Bank Governing Council member Robert Holzmann. “The ECB could take a first interest rate step in the summer and a second at the end of 2022,” Holzmann said in an interview with NNZ.
The GBP/USD fell to 1.3540 on Tuesday but managed to erase a large part of its daily losses to close at 1.3580. The pair is trading in a tight range below 1.3600 in early European morning. Later in the session, Bank of England (BOE) Governor Andrew Bailey will present the Monetary Policy Report to the UK Parliament.
The gold advanced to a fresh multi-month high above $1,910 on Tuesday, but lost traction on cooling safe-haven flows. XAU/USD appears to have entered a consolidation phase near $1,900 midweek.
The Bitcoin staged a rally after falling to multi-week lows on Tuesday, but continues to trade below $40,000. The ethereum continues to rise after closing in positive territory on Tuesday and was last seen rising more than 1% near $2,700.
Source: Fx Street
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