Central banks are in focus this week, with Wednesday’s Fed meeting already causing volatility in the FX markets. Meanwhile, Boris Johnson’s continued absence does little to dent his popularity, as the chance of no-deal Brexit raises likeliness of stockpiling.
-
European markets tread water ahead of central bank focused week
-
Fed meeting the main event, as dollar rise highlights easing June rate cut expectations
-
Johnson cruises towards victory, with stockpiling likely to ramp up if he takes power
European markets are largely treading water this morning, as an indecisive Asian session gives way to a similarly unconvincing start to the week for UK and eurozone markets. The dollar managed to stage a late recovery last week, with volatility expected to continue today ahead of the crucial Federal Reserve announcement on Wednesday. The week will be dominated by central banks, with the RBA, BoJ, Fed, and BoE all providing their latest monetary policy decisions in a period where markets are seeing a notable shift towards more dovish standing. Ultimately, we will be watching out for whether the Fed decides to cut rates as a key driver of market sentiment, yet Friday’s rebound for the dollar highlights the feeling that this is likely to be a wait-and-see event given the release of Q2 GDP next month.
The pound has continued its decline today, as the early June gains prove short-lived. The weekend debate was notable for Boris Johnson’s absence, and for the most part it seems to a fight over who will take the second slot to go toe-to-toe with BoJo in the final two. Johnson remains a huge favourite to become the next prime minister, and given his unpopularity in Brussels, coupled with his insistence that a no-deal Brexit remains on the table, there is good reason to believe we will see the pound continue to suffer if he gets into power. Firms have been open about their lack of preparation for a no-deal Brexit, yet should Boris Johnson become prime minister, we are sure to start seeing a
sharp rise in stockpiling ahead of the October deadline.
Ahead of the open we expect the Dow Jones to open 54 points higher, at 26,144.
This material is a marketing communication and shall not in any case be construed as an investment advice, investment recommendation or presentation of an investment strategy. The marketing communication is prepared without taking into consideration the individual investors personal circumstances, investment experience or current financial situation. Any information contained therein in regards to past performance or future forecasts does not constitute a reliable indicator of future performance, as circumstances may change over time. Scope Markets shall not accept any responsibility for any losses of investors due to the use and the content of the abovementioned information. Please note that forex trading and trading in other leveraged products involves a significant level of risk and is not suitable for all investors.
Recommended Content
Editors’ Picks
EUR/USD drops below 1.0800 after German Retail Sales data
EUR/USD has come under fresh selling pressure and trades below 1.0800 after the data from Germany showed that Retail Sales declined by 1.9% MoM in February. Resurgent US Dollar demand is adding to the downside in the pair. US data are next in focus.
GBP/USD stays weak near 1.2600 amid market caution
GBP/USD remains defensive near 1.2600 in European trading on Thursday. The hawkish tone from Fed Governor Christopher Waller keeps the US Dollar afloat amid a cautious trading environment ahead of key US data releases and the Good Friday trading lull.
Gold price holds strength ahead of US core PCE inflation
Gold price holds onto gains near $2,200 in Thursday’s European session. The precious metal exhibits firm footing ahead of the United States core PCE Price Index data for February, which will be published on Friday.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.