Fed meeting will take place
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Investors doubt the U.S. The Federal Reserve will announce plans to tighten its monetary policy at its meeting today. This contributes to the decline in the dollar index and supports the quotes of precious metals. The massive drop in Chinese stock indices caused a correction in US stocks. At the same time, there was no particular negative in the United States yesterday. Investors expect the continuation of the publication of quarterly reports.
Forex news
| Currency Pair | Change |
| EUR USD | -0.04% |
| GBP USD | -0.05% |
| USD JPY | +0.17% |
| AUD USD | -019% |
On Tuesday, the US dollar index fell for the second day in a row. Investors doubt the U.S. The Federal Reserve will announce plans to tighten its monetary policy at its meeting today. A rate increase of 0.25% is not expected, as well as a decrease in the volume of monthly redemption of government and mortgage bonds. Now it is $ 120 billion per month. U.S. yield 10-Year Bond is now near a 6-month low at 1.24% per annum. The British pound continued to rise thanks to the authorities' statements to lift restrictions on tourists from the United States and the European Union, who were fully vaccinated against the coronavirus. Recall that on July 19 in Britain, restrictions on local residents were lifted. This did not have a negative impact on the epidemiological situation. The euro fell slightly this morning on the back of a decline in the GfK Consumer Confidence indicator in Germany (-0.3). In Canada, today there are important data on inflation for June. Their outlook is positive, contributing to a slight current gain in the Canadian dollar.
Stock market news
| Indices | Change |
| Dow Jones Index | -0.24% |
| S&P 500 | -0.47% |
| Nasdaq 100 | -1.21% |
| US Dollar Index | +0.13% |
On Tuesday, US stocks dropped. In the United States, there was no particular negative for this. Investors reacted to the massive fall in China. The Hang Seng Index plunged 4.4%. From its February high, it has already dropped by 20%. The yuan weakened against the US dollar to a 3-month high (USDCNH). The main reason for all this was the tightening of Chinese legislation in relation to private companies from the educational sector, real estate, as well as high technologies in the field of cryptocurrencies, online finance, and online commerce. US macroeconomic data were neutral yesterday. Durable Goods Orders increased less-than-expected in June. This was offset by a rise in the CB Consumer Confidence in July to a 17-month high. There will be no significant macroeconomic data in the US today. Investors are awaiting the outcome of the Fed meeting. Let us remind you that the next meeting will take place only on September 22. Today in the US reports for the 2nd quarter of Facebook, PayPal Holdings, Pfizer, McDonald’s, Qualcomm, Boeing, and other companies will be released.
Commodity market news
| Commodities | Change |
| WTI Crude | +0.4% |
| Brent Crude Oil | +0.35% |
| COPPER | -0.39% |
World oil prices remained almost unchanged yesterday. The independent American Petroleum Institute announced a decline in US oil reserves for the week by 4.73 million barrels. This positive factor for oil quotes was offset by a negative one in the form of an increase in the number of people in the world infected with the new strain of the Delta coronavirus. The International Monetary Fund predicts an increase in economic inequality between countries due to unequal access to Covid-19 vaccines. Today, as usual, there will be official data on US oil reserves from the U.S. Energy Information Administration. They can affect quotes. The cost of coffee today again approached the maximum since October 2014 due to the persisting cold weather in Brazil. Since the beginning of 2021, coffee has risen in price by almost 2 times. Agency Conab reported that it affected from 150 thousand hectares to 200 thousand hectares of coffee plantations, or about 11% of their total area in Brazil.
Gold market news
| Metals | Change |
| Gold | +0.1% |
| Silver/US Dollar | +0.5% |
Gold quotes are rising in price today for the second day in a row, amid the weakening of the US dollar. Since the beginning of July, they have been in a narrow range around $ 1,800 per ounce. Silver hit its 4-month low yesterday. It is now trading below the psychological level of $ 25 an ounce. The dynamics of industrial metals and other goods, including oil, may be affected by US GDP data for the 2nd quarter, which will be released tomorrow.
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Author
Dmitry Lukashov
IFC Markets
Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.
