What you need to know on Friday, June 4:
The greenback soared against most of its major rivals, reaching fresh weekly and even monthly highs across the FX board. Late on Wednesday, the US Federal Reserve announced it would start unwinding one of its programs set to support the economy throughout the pandemic. "Portfolio sales will be gradual and orderly and will aim to minimize the potential for any adverse impact on market functioning," the Fed said.
The news sent stocks lower and the dollar higher, with the latter’s rally fueled by upbeat US data. The country published the ADP survey on private jobs creation, which posted a whopping 978K in May, largely surpassing the 650K expected. Initial Jobless Claims for the week ended May 28 printed at 385K, better than the 395K expected and the lowest reading since the pandemic started. Finally, the ISM Services PMI jumped to 64 in May, beating expectations.
The US economy is recovering at a faster pace, helped by the immunization campaign and better weather. The country is set to publish the May Nonfarm Payrolls report on Friday, and substantial job gains could further fuel the American currency.
The EUR/USD pair flirts with 1.21, while GBP/USD trades around 1.4100. The USD/JPY pair soared to a fresh 2-month high of 110.31, while commodity-linked currencies also gave up to the dollar’s strength.
Gold plummeted and finished the day at $ 1.871 a troy ounce, while crude oil prices held on to gains. WTI settled at $ 68.70 a barrel.
European equities closed in the red, leading to sharp losses in Wall Street ahead of the opening. However, upbeat US data helped US indexes to trim most of their intraday losses.
US government bond yields ticked higher and settled near the upper end of their weekly range.
Shiba Inu Price Forecast: SHIB investor patience may reward 40% profit
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 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 bulls keenly await US PCE Price Index on Friday before placing fresh bets
Gold price (XAU/USD) continues with its struggle to make it through the $2,200 mark on Thursday and oscillates in a narrow trading band through the early part of the European session.
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.
The other terminal rate: How far will policy rates be cut?
Recent communication by the Federal Reserve and the ECB has made it clear that the first cut in official interest rates is coming. Both central banks are saying the same but the ECB communication is more opaque than that of the Fed.