As markets await tomorrow’s US CPI data and FOMC release, major US stock indices continue to close at new all-time high prices, suggesting market confidence in a smooth path to rate cuts.
- Two of the major US equity indices, the NASDAQ 100 and the S&P 500, closed yesterday at new all-time record prices. European stock markets are also quite bullish. This comes as markets await tomorrow’s crucial US CPI (inflation) data release, as well as the Fed’s policy statement – this will be a big day for the Forex market, with a spike in volatility expected. The Fed is not expected to make any changes to rates, the important detail will all be in the statement and forecast.
- Precious metals are weak, with Gold looking heavy as it trades very close to a 2-month low near an area of support at about $2285. A breakdown below this level could trigger a stronger fall.
- The Euro fell on news of the results of the European Parliament election in France and Macron’s shock calling of a general election which could result in the country’s first hard right government since the Second World War. However, the Euro now seems to have found support, with the EUR/USD currency pair basing off the big quarter-number at $1.0750.
- In the Forex market, the strongest major currency since the Tokyo open is the Euro, while the Japanese Yen has been the weakest major currency.
- The Indonesian Rupiah is trading at a 4-year low, but a rate hike seems unlikely as President Widodo seems relaxed about the weak Rupiah. Bank Indonesia does not expect USD/INR to breach 16,300, but the price is trading right on this level at the time of writing.
- UK Claimant Count Change data released earlier today in the UK was worse than expected, suggesting a slowing UK economy.
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