Here is what you need to know on Thursday, August 11:
The US Dollar Index (DXY), which tracks the greenback's performance against a basket of six major currencies, lost more than 1% on Wednesday after the data from the US showed that annual inflation declined to 8.5% in July from 9.1% in June. DXY stays in a consolidation phase above 105.00 early Thursday as investors await the weekly Initial Jobless Claims and the Producer Price Index (PPI) data from the US. Following Wednesday's impressive rally, Wall Street's main indexes remain on track to open in positive territory with US stock index futures rising between 0.35% and 0.5%. Meanwhile, the benchmark 10-year US Treasury bond yield continues to fluctuate between 2.7% and 2.8%.
Commenting on the inflation data, Chicago Fed President Charles Evans said that they were not finished with rate hikes. On a similar note, Minneapolis Fed President Neel Kashkari and San Francisco Fed President Mary Daly both argued that it was too early to declare victory on inflation. According to the CME Group FedWatch Tool, markets are pricing in a 56% probability of the Fed opting for a 50 basis points rate hike in September.
US Inflation Analysis: It is peak inflation only until the Fed's verdict, stock rally at risk.
EUR/USD climbed to its highest level in a month at 1.0368 on Wednesday but retreated to the 1.0300 area in the European session on Thursday.
GBP/USD gained more than 100 pips on Wednesday and advanced toward 1.2300 before losing its bullish momentum. Ahead of Friday's growth data from the UK, the pair stays relatively quiet above 1.2200.
UK GDP Preview: Early confirmation of BOE’s recession forecast.
USD/JPY fell sharply on soft US inflation data but the T-bond yields' resilience helped the pair find support. As of writing, USD/JPY was moving sideways in a narrow band below 133.00.
Gold advanced beyond $1,800 for the first time in nearly two months on Wednesday but failed to preserve its bullish momentum. After having closed the day with small losses on Wednesday, XAU/USD continues to inch lower and was last seen trading below $1,790.
Bitcoin benefited from the risk-positive market environment and gained nearly 4% on Wednesday. BTC/USD pushes higher toward $25,000 and early Thursday. Ethereum is trading at its highest level in two months and closes in on $2,000.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady above 1.0750 on improving risk mood
EUR/USD continues to trade above 1.0750 on Monday. The data from Germany showed that IFO Business Climate Index improved to 93.3 in March from 91.1 in February, helping the Euro stay resilient against the US Dollar. The risk-positive atmosphere further supports the pair.
GBP/USD regains 1.2250, Bailey speech eyed
GBP/USD clings to modest gains above 1.2250 on improving risk mood on Monday. The US Dollar struggles to gather strength despite rising US Treasury bond yields. In the absence of high-impact data releases, investors will pay close attention to BOE Governor Bailey's speech.
Gold extends slide to $1,950 as US yields rebound
Gold price has extended its daily slide to the $1,950 area in the European session. Amid easing fears over a global banking crisis, the benchmark 10-year US Treasury bond yield rebounds toward 3.5% on Monday, weighing heavily on XAU/USD.
Four reasons why SUSHI holders will have a bullish week despite SEC's move
SushiSwap price undid the early March gains in the last week after the SEC subpoenaed the platform’s head chef Jared Grey. As a result of this announcement, the token collapsed by roughly 18%.
Calm, so far
It's been comparatively calm in markets to start the week as Investors better understand the problems facing American banks today are not remotely similar to the subprime mortgage crisis.