|

Forex Today: Powell keeps pressure on the dollar, Bitcoin consolidates, jobless claims eyed

Here is what you need to know on Thursday, February 11:

Markets have taken a pause in their rises and the dollar from its decline. Fed Chair Powell wants the US to reach full employment ahead of jobless claims and as inflation remains low. The New Year holiday in China has been partially responsible for subdued trading, which is set to pick up later.

Jerome Powell, Chairman of the Federal Reserve, spoke on Wednesday and reiterated his commitment to providing support to the economy, stressing that the job market needs to return to full employment. Powell stated that the Fed will not tighten policy solely in response to an improvement in the labor market. The Fed Chair also downplayed inflation, which came out at 1.4% yearly in January, lower than expected. 

US Consumer Price index: Does weak inflation means weak demand?

Powell's comments and weak inflation sent investors to buying stocks, lowering yields but only marginally impacting the dollar. Gold prices are off their highs above $1,850. 

Lisa Cook, an economist who is considered a dove, will reportedly be nominated to the Federal Reserve's boar.

Weekly jobless claims are due out on Thursday and are expected to show an ongoing decline. Nevertheless, applications remain at elevated levels.

US Initial Jobless Claims Preview: The trend's the thing

Stimulus: Washington remains consumed by the trial of former President Donald Trump, pushing discussions about fiscal stimulus to the background. Some expect a drive to pass the relief bill, of unknown size, in the last week of February. 

President Joe Biden spoke with his Chinese counterpart Xi Jinping and both reportedly discussed various known points of contention such as Beijing's economic practices, human rights, the climate, and more.  There were no outstanding headlines to move markets, but the White House is set to conduct a review of relations between the world's largest economies. 

UK: Prime Minister Boris Johnson lowered expectations about foreign summer holidays amid ongoing uncertainty about the virus and despite the UK vaccinating some 20% of its population. On the Brexit front, the EU has pushed back the date for ratifying its accord.

In Europe, Germany extended its lockdown as coronavirus cases remain stubbornly high. The old continent is trying to reignite its sluggish vaccination campaign. EUR/USD is holding above 1.21 ahead of the EU's publication of new economic forecasts. 

Bitcoin has been extending its downside correction and trades at around $45,000 after hitting record highs near $48,000. Elon Musk, who announced that his company Tesla would invest in BTC, returned to tweeting about Dogecoin. US Treasury Secretary Janet Yellen warned of the misuse of cryptocurrencies for illicit activities. On the other hand, Mastercard will support selected digital coins on its network. 

Bitcoin Price Forecast 2021: BTC reaching new horizons, aiming for $100,000

Author

Yohay Elam

Yohay Elam

FXStreet

Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.

More from Yohay Elam
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD stays bid near 1.1650 ahead of Fed rate decision

EUR/USD keeps the green near the 1.1650 level in the European session on Wednesday. Markets turn cautious and ignore the US Dollar ahead of the US Federal Reserve interest rate decision later on Wednesday, where a 25 bps rate cut is almost fully priced in. Meanwhile, cautious ECB-speak keeps the Euro afloat. 

GBP/USD holds gains above 1.3300, eyes on Fed outcome

GBP/USD trades on a firmer note above 1.3300 in Wednesday's European session. The US Dollar weakens against the Pound Sterling as the US Federal Reserve is widely expected to announce another interest rate cut on Wednesday. Next of note will be the UK monthly Gross Domestic Product (GDP) report that will be published on Friday. 

Gold struggles around $4,200, looks to Fed for fresh impetus

Gold extends its sideways consolidative price move through the European session and trades around $4,200 this Wednesday. Traders now seem reluctant and opt to wait for the outcome of a two-day FOMC policy meeting later in the day. The key focus will be on updated economic projections and Powell's speech.

Federal Reserve expected to cut interest rates as disagreement among officials grows

The United States (US) Federal Reserve (Fed) will announce its interest rate decision on Wednesday, with markets widely expecting the US central bank to deliver a final 25 bps cut for 2025.

BoC expected to hold interest rate, signaling the end of easing cycle

The Bank of Canada is widely expected to maintain its benchmark interest rate at 2.25% at its meeting on Wednesday. That would follow two consecutive quarter-point rate cuts in September and October.

Zcash Price Forecast: ZEC extends gains as derivatives turn decisively bullish

Zcash (ZEC) price extends gains, trading above $440 on Wednesday after rallying nearly 30% so far this week. ZEC’s rising open interest, elevated bullish bets, and a shift to positive funding rates all point to stronger demand.