Stocks push higher after choppy week
Wall Street has pushed higher as the threat of US intervention in the Middle East having abated for now. Trump’s infamous ‘two-week period’ for making decisions seems to suggest that the rush towards further conflict has been halted, though Iranian intransigence might provoke the president. This should also cool oil prices for the time being too, with the market having become relatively desensitised to the back-and-forth of missile launches and air strikes that currently characterises the Iran-Israel war.
Fed’s Waller hints at rate cuts
Consolidation has been the theme in US stocks for some time, but hints of a more dovish approach from the Fed have been kept alive by Christopher Waller, who thinks the time has come for the Fed to cut rates. Even tariffs are not expected to provide a permanent boost to inflation, he added, bolstering the cause for ‘looking through’ any increase and focusing on the need to support the US economy.
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EUR/USD appears side-lined around 1.1700 ahead of Fed Minutes
EUR/USD remains under modest downward pressure, trading just above 1.1700 amid a consolidative range on Wednesday. The pair's bearish tone comes as President Donald Trump announced additional tariffs and hinted that more are coming, maintaining market uncertainty. In the meantime, traders are waiting for the FOMC Minutes, which could shed more light on the Fed's potential rate path.
GBP/USD extends its consolidation below 1.3600
GBP/USD alternates gains with losses on Wednesday, embarking on a range-bound theme just below the 1.3600 barrier. The cautious market sentiment caused by the uncertainties surrounding US trade policies allows the US Dollar to remain resilient against its peers while limiting Cable’s upside.
Gold recovers above $3,300 on another round of Trump letters
Despite lacklustre gains in the US Dollar and declining US yields across the board, Gold regained traction and advanced modestly north of the key $3,300 per troy ounce on Wednesday. The improved tone in the precious metal remains propped up by uncertainty on the trade front, while traders shift theur focus to the release of the FOMC Minutes.
Fed Minutes to offer clues on next rate cuts amid tariff turmoil
The Minutes of the US Fed’s June 17-18 monetary policy meeting will be published on Wednesday at 18:00 GMT. Policymakers decided to maintain the policy rate at the range of 4.25%-4.5%, but the revised Summary of Projections showed that policymakers were projecting two 25 bps rate cuts in 2025.
New US tariffs target Asia, but some countries stand to gain
President Trump’s new tariffs are higher than expected for most Asian economies. Moreover, most countries will face additional tariff rates on transshipments. The new announcements are silent on Singapore, India and the Philippines, which might stand to benefit from tariff concessions if negotiations progress favourably.
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