This is what you need to know to trade today Thursday March 10:
The observed positive change in risk sentiment weighed heavily on the US dollar on Wednesday and helped risk-sensitive assets rally sharply. The dollar holds its ground against its main rivals in the early hours of Thursday and the markets turn cautious waiting for the news of the meeting between Russian Foreign Minister Sergei Lavrov and his Ukrainian counterpart Dmytro Kuleba. Later in the day, the European Central Bank (ECB) will announce its monetary policy decision and the data of the consumer price index CPI February will appear on the US economic calendar.
Bloomberg reported on Wednesday that the Ukrainian president’s deputy chief of staff, Zhovkva, said that Ukraine was ready for a diplomatic solution and added that there must be security guarantees. In addition, the Ukrainian president, Volodymyr Velenskyy, told the German daily Bild that the goal of Thursday’s talks was to end the war and noted that Ukraine was ready to make certain commitments if Russia did too. On a negative note, the Russian state media RIA said that Russia would not concede anything in the next round of peace talks with Ukraine.
See: Is the war in Ukraine over?
Reflecting the risk sentiment in the market, the S&P 500 it gained more than 2% on Wednesday and the benchmark 10-year Treasury yield rose 4%. Finally, the barrel West Texas Intermediate WTI it lost 12% before settling between $108 and $109 early Thursday. Meanwhile, US stock index futures are posting small losses at the start of the European session.
The US dollar index DXY, which fell 1.1% on Wednesday, is trading sideways near 98.00. The annual CPI in the US is expected to rise to a new multi-decade high of 7.9% in February from 7.5% seen in January.
See: February CPI in the US: Will Ukraine’s war sideline central banks?
See: US February CPI Preview: Will Strong Inflation Break the Fed’s Hand?
The EUR/USD remains relatively calm around 1.1050 after gaining almost 200 pips on Wednesday. It is widely expected that the ECB keep its monetary policy adjustments unchanged, but market participants will pay close attention to revising growth and inflation projections. ECB President Christine Lagarde’s comments on the political outlook amid the Russia-Ukraine crisis could also trigger a significant reaction in the markets.
See: ECB Preview: More suffering for the euro in the face of the crisis in Ukraine and risks of stagflation
See: ECB Preview: Lagarde will hit the euro while cannon shots are heard and stagflation is looming
The GBP/USD staged a decisive bounce on Wednesday but lost its upside momentum before testing 1.3200.
The gold it erased all the gains it posted on Tuesday in the second half of the day on Wednesday in a dramatic reversal. XAU/USD stays on the defensive at the start of Thursday and trades below $1,990.
Despite broad selling pressure around the US dollar, the USD/JPY rose above 116.00 fueled by rising US T-bond yields.
The Bitcoin gained 8% and climbed above $42,000 before erasing most of its gains during the Asian session on Thursday. BTC/USD is now trading below $40,000 losing 6% on the day. The ethereum remains under bearish pressure and is trading deep in the negative near $2,600 after posting gains over the previous two days.
Source: Fx Street
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