Forex Today: Busy start to a busy day

FXStreet Team FXStreet

Here is what you need to know on Thursday, July 16:

High-yielding assets soared on the back of late Tuesday’s Moderna news, as a potential vaccine delivered immune response against coronavirus in all patients treated at phase one. The company prepares to enter phase three and proceed with massive testing.

The EUR/USD pair surged to 1.1451 as speculative interest sold-off the greenback, although with Wall Street easing from intraday highs, the dollar recovered ahead of the close. The pair settled just above the 1.1400 level.

Upbeat UK inflation data helped GBP/USD reach an intraday high of 1,2649, although the pair retreated sub-1.2600 ahead of the close. UK core CPI was up by 0.6% still far below the BOE’s 2% target.

Market mood partially deteriorated on mounting tensions between the US and China. Secretary of State Mike Pompeo announced visa restrictions on employees of Chinese technology companies, including Huawei. Chinas foreign minister announced they will summon US ambassador to China over the Hong Kong autonomy act, adding the government will take the necessary measures, including sanctions against US entities and individuals.

The Bank of Canada had a monetary policy meeting, keeping its key interest rate at 0.25%, and will remain so for a “long time,” according to governor Macklem. Policymakers expect the economy to contract by 7.8% this year, and to return to growth in 2021, seen then surging by 5.1%.

Gold seesawed between gains and losses throughout the day, ending it little changed around $1,810 a troy ounce. Despite the better market mood, the commodity maintains its bullish stance, as uncertainty continues alongside massive stimulus from most major central banks.

Crude oil prices dropped on output cut-related headlines but got to recover after the US EIA stockpiles report showed a decline of 7,49 million barrels in the week ended July 10. WTI extended its advance to $ 41.00 a barrel.

Early Thursday, China will publish its Q2 GDP, foreseen at 9.6% from -9.8% in Q1. The country will also unveil June Retail Sales and Industrial Production, both seen recovering from negative levels.

Australia will release its June employment data, which could be offset by the recent lockdown in the Melbourne area.

Later in the day, the UK will publish employment figures while the ECB will have a monetary policy meeting.

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FXStreet Team

FXStreet

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GBP/USD remains well bid around 1.3650

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Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

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