Key Releases for the Present Trading Session
The USD exhibits mixed dynamics when paired with the euro and is now rising versus the pound and falling against the yen.
Investors continue to pay attention to the US Fed's remarks without big economic announcements. Esther George, the Federal Reserve Bank of Kansas City president, made several remarks earlier. She said there is no other option than to reduce economic stimulus, but the rate at which interest rates should rise is still debatable. Inflation has reached a 40-year high. George dissented from her colleagues' plan to raise it by 75 percentage points all at once because she believed that such sudden changes might put undue strain on the financial markets and the economy. The official believes that boosting the rate by 50 percentage points this month will help investors adjust quickly to changing circumstances. The call will anticipate the release of the June US inflation figures tomorrow. The consumer price index is expected to increase and reach 8.8 percent annually, giving the US Fed more excellent justification for tightening monetary policy.
The euro has a shaky relationship with the US dollar and is losing ground to the yen while gaining ground versus the pound.
Today, the ZEW released its July statistics on the index of business sentiment in Germany. The indicator dropped significantly from -28.0 to -53.8 points, and as a result, it was below the level at the start of the coronavirus pandemic. The German business community is concerned about significant issues with energy resources, disruptions in the supply of components and raw materials, and an increase in interest rates by the European Central Bank (ECB). We also take note of Valdis Dombrovskis, vice-president of the European Commission. They recently stated that while the eurozone economy appears to be growing steadily this year, its size will decline due to numerous new economic issues. According to the official, inflation predictions will be updated higher.
the country of the UK
Compared to its three main rivals, the USD, the euro, and the yen, the pound is losing ground.
British Retail Consortium (BRC) data for June UK retail sales were announced today, showing a decline of 1.3 percent, higher than the anticipated 1.2 percent. In general, British retailers continue to lose money when consumers choose not to purchase due to the high inflation rate. Sales are declining to levels last seen during the COVID-19 pandemic, according to BRC Chief Executive Helen Dickinson, as consumers decrease spending and inflation rises. The worst hurt was sales of household products and appliances. The BRC encouraged the government to assist shops by lowering taxes.
Compared to its primary rivals, the US dollar, the euro, and the pound, the yen is getting stronger.
The June price index for corporate goods data was released today in Japan, confirming the country's ongoing rise in inflation. Every month, the indicator increased from 0.1 percent to 0.7 percent. On an annual basis, it came to 9.2 percent, which is lower than the May indicator of 9.3 percent but higher than the expected value of 8.8 percent. Analysts predict that Japan's significant reliance on energy and fuel imports could keep the country's inflation high and prevent the country's economy from fully recovering.
In contrast to the pound and the US dollar, the Australian dollar is strengthening vs. the yen and the euro.
Today saw the release of Australia's Westpac Consumer Sentiment Index for June, which fell to -3.0 percent for the eighth consecutive month. Consumers are generally concerned about their economic prospects due to growing living expenses and the Reserve Bank of Australia's increase in interest rates. The index, typically linked to global shocks or recessions, has decreased by almost 20 percent since December last year, according to Westpac Chief Economist Bill Evans.
The price of oil kept falling.
New predictions released by OPEC today put pressure on prices. Next year, it's anticipated that the global oil demand will increase again, but more slowly than it did this year. The Organization of the Petroleum Exporting Countries stated in a monthly report that the amount is projected to rise by 3.36 million barrels per day in the current year and by 2.7 million barrels per day in 2023. The cartel is simultaneously betting on improving global geopolitical conditions and the unrealistic assumption that increasing inflation won't seriously slow down the international economy.
Investors also typically worry about "black gold" prices falling due to a decline in demand and the worsening epidemic in China. Investors await the release of the American Petroleum Institute's weekly report on the number of oil reserves in the USA during the day (API). The amount increased by 3.825M barrels the last time. The continuance of this pattern could increase the pressure on oil prices.