The New Zealand dollar rose today after a hawkish statement from the central bank. The bank left interest rates unchanged at 1.75% and guided that it will probably change in 2021. It also indicated that the next rate decision will either be up or down. On a macro level, the bank indicated that while the economy is doing well, it has failed to stimulate inflation, which remains below the target of 2%. After reaching an intraday high of 0.6850, the NZD/USD pair pared some of those gains and reached a low of 0.6815.
The price of crude oil rose today as traders waited for inventory numbers from the EIA. The data is expected to show that inventories rose by 2.6 million barrels in the past one week. This data will come hours after data from the American Petroleum Institute (API) showed that inventories shrank by 998K in the week. However, in the past, the data between the two has differed by a wide margin. This data will come after the EIA released its monthly report. The report showed that there will be surplus this year even with the ongoing production cuts by OPEC.
The sterling rose today against the USD as investors continued to pay close attention to the Brexit situation. Reports indicated that Theresa May was planning to run the clock on Brexit. Her goal is to bring her bill to parliament before the deadline. This will make the members chose between her compromise deal and a no-deal Brexit. Meanwhile, data showed a softening of inflation. The CPI rose by 1.8%, which is lower than the expected 1.9% while the core CPI remained unchanged at 1.9%. The house price index rose by 2.5%, which was lower than the expected 2.6%. The retail price index rose by 2.5%, which was lower than the expected 2.7%.
The USD rose after the release of inflation data from the US. The data released today showed that the core CPI rose by 2.2% in January. This was a higher rate than the expected 2.1%. On a MoM basis, the core CPI number was unchanged. The headline CPI number rose by 1.6%, which was higher than the expected 1.5%. On a monthly basis, the headline CPI was unchanged. The numbers show that the Fed could still increase rates this year.
The price of Brent crude oil moved up slightly today as traders waited for the EIA inventory data. The pair reached a high of 63.45, which is the highest level since February 4. On the four-hour chart, the pair remains within the narrow range shown below. The pair’s price is above the 21-day and 42-day EMA while the momentum indicator is moving above the 100 level. The Parabolic SAR is pointing to more upward movements. There is a likelihood that the pair will continue moving up, but it could also fall if US inventories move up.
The GBP/USD pair rose slightly against the USD as investors continued to focus on Brexit. The pair is now trading at 1.2915, which is along the middle line of the Bollinger Bands. The price is also along the 42-day and 21-day EMA while the RSI is moving in an upward trajectory. At this point, the pair could move in either direction depending on the outcome of the Brexit negotiations.
The EUR/USD pair dropped after strong inflation numbers from the United States. The pair reached a low of 1.2950, which was the lowest level since yesterday. On the hourly chart, the pair remains along the lower line of the Bollinger Band while the Parabolic SAR points to more downward trend. The RSI too has started to move lower and is currently at 39, which is a low than yesterday’s high of 70. The pair could continue moving lower because of the strong inflation numbers.
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