Here is what you need to know on Wednesday, May 4:

Following Tuesday's choppy action, markets remain calm early Wednesday as investors move to the sidelines ahead of the US Federal Reserve's policy announcements. The US Dollar Index continues to move sideways near 103.50 and the 10-year US T-bond yield fluctuates in a tight range below 3%. The European economic docket will feature March Retail Sales data for the eurozone. April ADP Employment Change and ISM Services PMI from the US will be looked upon for fresh impetus in the early American session. 

ADP Employment Change April Preview: Will employment threaten Fed rate hikes?

European Commission President Ursula von der Leyen said early Wednesday that they will phase out the Russian supply of crude oil and refined products by the end of the year. Von der Leyen further added that Sberbank and other major Russian banks will be excluded from the SWIFT system as part of the latest sanctions package.

The Fed is widely expected to hike its policy rate by 50 basis points and unveil its plan for balance sheet reduction. FOMC Chairman Jerome Powell will deliver his remarks on the policy and the economic outlook at a press conference at 1830 GMT. 

Federal Reserve Preview: Buy the dollar dip and three other scenarios as Powell shows his power.

In the meantime, Beijing announced earlier in the day that they shut more than 40 metro stations and 158 bus routes to limit the spread of the virus. Additionally, Zhengzhou said that it will start enforcing strict coronavirus restrictions from next week. Meanwhile, Reserve Bank of New Zealand Governor Adrian Orr said earlier in the day that they cannot rule out a global recession in the coming months. Nevertheless, US stock index futures post small gains in the early European session but the market mood is likely to remain cautious ahead of the Fed event.

EUR/USD continues to fluctuate above 1.0500 on Wednesday but stays on the back foot with the Euro Stoxx 600 Index losing nearly 0.5% in the early European session.

GBP/USD staged a rebound on Tuesday but erased its daily gains after having met resistance at 1.2570. The pair was last seen moving sideways near 1.2500.

Gold is edging higher toward $1,870 Wednesday morning but struggles to gather bullish momentum as US T-bond yields remain steady.

USD/JPY is moving in an extremely narrow trading band near 130.00 for the third straight day on Wednesday.

Bitcoin is up more than 2% early Wednesday but continues to trade below the key $40,000 level. After having lost nearly 3% on Tuesday, Ethereum has regained its traction and was last seen rising 1.5% on the day at $2,820. 

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.

Feed news Join Telegram

Recommended content

Recommended content

Editors’ Picks

EUR/USD remains sidelined below 1.0600 ahead US data

EUR/USD remains sidelined below 1.0600 ahead US data

EUR/USD is trading close to 1.0600, keeping its range play intact. The US dollar stays sluggish amid a better mood, awaiting the CB Consumer Confidence data. The euro shrugs off the ECB commentary on the new anti-fragmentation tool. 


GBP/USD ranges below 1.2300 amid sluggish USD, US data eyed

GBP/USD ranges below 1.2300 amid sluggish USD, US data eyed

GBP/USD is moving back and forth in a familiar range below 1.2300, lacking a clear directional bias amid a muted US dollar index and risk-on sentiment. Ongoing Brexit and UK political woes remain a drag on the pound. US data eyed. 


Gold bears eye $1,820 and $1,816 as next targets

Gold bears eye $1,820 and $1,816 as next targets

Optimism prevails, pointing to a turnaround Tuesday for the financial markets, as the previous week’s upbeat global momentum returns and caps the broad US dollar recovery. Investors remain wary ahead of the key NATO Summit.

Gold News

Former Ripple CTO is dumping millions of XRP, traders beware

Former Ripple CTO is dumping millions of XRP, traders beware

XRP price shows promise that it is ready to trigger a massive run-up as the first half of the year comes to an end. There are three reasons why investors should be bullish on Ripple.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!