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America’s Roundup: Dollar falls as Fed talks about tapering but sets no timeline, Wall Street ends mixed,Gold gains,Oil settles up near $75, sharp U.S. inventory drop counters virus worry-July 29th,2021

Posted at 28 July 2021 / Categories Market Roundups


Market Roundup

•Canada Trimmed CPI (YoY) 2.6%,2.7% previous

•Canada Median CPI (YoY) 2.4%,2.4% previous

•Canada Common CPI (YoY) 1.7%,1.8% previous

•US Wholesale Inventories (MoM) 0.8%,1.3% previous

•Canada Jun  CPI (MoM)  0.3%,0.4% forecast, 0.5% previous

•US Jun Goods Trade Balance  -91.21B,-88.16B previous

•US Jun Retail Inventories Ex Auto  0.6%,0.9% previous

•US Jun Core CPI (MoM)  0.3%,0.4% forecast, 0.4% previous

•US CPI (YoY) 3.1%, 3.2% forecast, 3.6% previous

•US Core CPI (YoY) 2.7%,2.4% forecast,2.8% previous

•US Gasoline Inventories -2.253M, -0.916M forecast, -0.121M previous

•US Crude Oil Inventories- -4.089M, 2.928M forecast, 2.108M previous

•US Fed Interest Rate Decision 0.25%, 0.25% forecast, 0.25% previous

Looking Ahead –Economic Data (GMT)

• 23:50 Japan Foreign Investments in Japanese Stocks -10.5B previous

• 23:50 Japan Foreign Bonds Buying -1,217.8B previous

• 01:00 New Zealand Jul NBNZ Own Activity  31.6% previous

• 01:00 New Zealand Jul ANZ Business Confidence  -0.6 previous

•01:30 Australia  Import Price Index (QoQ) (Q2) 0.2% previous

•01:30 Australia  Export Price Index (QoQ) (Q2) 11.2% previous

Looking Ahead - Events, Other Releases (GMT)

•No significant events

Currency Summaries

EUR/USD: The euro strengthened against dollar on Wednesday after the Federal Reserve gave no clue about when it might start reducing its purchases of government bonds. At a news conference, Fed Chairman Jerome Powell said it was not yet time to think about raising interest rates, and that while the Fed has begun discussing plans to taper its bond purchases, the exact timing will depend on incoming data. The dollar index fell 0.24%, and a weaker dollar boosted the euro up 0.28% to $1.1843. Immediate resistance can be seen at 1.1850(38.2%fib), an upside break can trigger rise towards 1.1869 (23.6% fib).On the downside, immediate support is seen at 1.1834 (50% fib), a break below could take the pair towards 1.1819 (61.8%fib).

GBP/USD: Sterling held firm against dollar on Wednesday as run of falling UK COVID-19 infections raised investor hopes that the Bank of England could be less dovish than expected when it meets next week. England scrapping quarantine rules for fully-vaccinated visitors from the European Union and United States was also   supported  the pound’s gains.At 1950 GMT, the pound was last up 0.07 % percent up versus the dollar, at $1.3906. Immediate resistance can be seen at 1.3915 (38.2%fib),an upside break can trigger rise towards 1.3951(higher BB).On the downside, immediate support is seen at 1.3906 (5DMA), a break below could take the pair towards 1.3827 (50%fib).

USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday as stock markets calmed globally, but gains were capped by data showing national inflation rose less than expected in June. Canada's annual inflation rate in June dipped to 3.1% from 3.6% in May, held back by price increases in June last year, data from Statistics Canada showed. The Canadian dollar  was trading 0.2% higher at 1.2521 to the greenback, after trading in a range of 1.2560 to 1.2604. Immediate resistance can be seen at 1.2552(5 DMA), an upside break can trigger rise towards at 1.2574 (38.2%fib).On the downside, immediate support is seen at 1.2514(50%fib), a break below could take the pair towards 1.2455 (61.8%fib).

USD/JPY: The dollar edged lower against the Japanese yen on Wednesday after the Federal Reserve gave no clue about when it might start reducing its purchases of government bonds, even as it said the economic recovery is on track. The lack of a clear taper timeline dragged on the dollar lower. The U.S. currency had a month-long rally as investors bet a strengthening economy would spark a Fed move to taper to quell inflation pressures.The dollar was last trading 0.01 percent lower versus the yen  at 109.90.Strong resistance can be seen at 110.01(38.2%fib), an upside break can trigger rise towards 110.14 (5DMA).On the downside, immediate support is seen at 109.70 (50%fib), a break below could take the pair towards 109.39(61.8%fib).

Equities Recap

European stocks gained on Wednesday as encouraging earnings reports from British bank Barclays and luxury group Kering helped investors look past worries about China’s regulatory crackdown that kept markets on edge this week.

UK's benchmark FTSE 100 closed up  by  0.29 percent, Germany's Dax ended up by 0.33 percent, France’s CAC finished the day up by 1.19 percent.                

The S&P 500 ended little changed on Wednesday but off its session lows after the Federal Reserve said the U.S. economic recovery remains on track and Chair Jerome Powell said the central bank was still a ways away from considering raising interest rates.

Dow Jones closed down by 0.36 percent, S&P 500 closed down by 0.02  percent, Nasdaq settled up by 0.70 % percent.

Treasuries Recap

U.S. Treasury yields fell on Wednesday after the Federal Reserve flagged ongoing discussions around the eventual withdrawal of monetary policy support but gave no details on when it is likely to reduce bond purchases.

Benchmark 10-year yields fell to 1.228%, after briefly rising to a session high of 1.278% immediately after the statement.

Commodities Recap

Gold prices on Wednesday shook off initial declines to move higher after a U.S. Federal Reserve policy statement as chair Jerome Powell flagged lingering risks to the U.S. economy from the Delta coronavirus variant.

Spot gold was up 0.1% at $1,801.10 per ounce by 2:56 p.m. EDT (1856 GMT). U.S. gold futures were little changed at $1,800.50.

Oil settled near $75 a barrel on Wednesday after data showed U.S. crude inventories fell to pre-pandemic levels, bringing the market's focus back to tight supplies rather than rising COVID-19 infections.

Brent crude ended the session up 26 cents, or 0.4%, to $74.74 a barrel, after posting on Tuesday its first decline in six days. U.S. West Texas Intermediate (WTI) crude settled up 74 cents, or 1%, at $72.39.


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