Forex Today: US inflation bolstered the risk appetite

Pablo Piovano FXStreet

The risk complex regained strong upside traction on the back of the generalized offered stance in the US Dollar in the wake of the release of US inflation data measured by the CPI in April.

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

A dreadful session for the Greenback saw the USD Index (DXY) retreat further and revisit the area of the key 200-day SMA near 104.30 on Wednesday. On May 16, the US housing sector takes centre stage with the releases of monthly Building Permits and Housing Starts seconded by the usual Initial Jobless Claims, the Philly Fed Manufacturing Index and Industrial Production. In addition, Fed’s Barr, Harker, Mester and Bostic are all due to speak.

EUR/USD rose for the third session in a row and approached the 1.0900 hurdle always on the back of further USD-selling.The ECB’s Financial Stability Review will be the sole release on the domestic docket on May 16.

GBP/USD extended further its march north and traded at shouting distance from the 1.2700 hurdle. The BoE’s Financial Stability Report will be out on May 16.

USD/JPY interrupted its multi-day uptrend and receded to multi-session lows in the sub-155.00 zone following increasing weakness in the Dollar and declining yields. The advanced Q1 GDP Growth Rate, final Industrial Production prints and weekly Foreign Bond Investment are expected on May 16.

A robust session in the risk-linked assets propelled AUD/USD to levels just shy of the 0.6700 hurdle ahead of key data in Australia. The release of the labour market report and the speech by RBA’s Hunter are all due on May 16 in Oz.

A larger-than-expected drop in US crude oil supplies and the sharp pullback in the Greenback sustained the decent uptick in WTI prices despite the discouraging IEA report.

Gold prices surged to the proximity of the $2,400 zone per troy ounce on the back of rising expectations of Fed interest rate cuts, the weaker Dollar, and lower US yields. Silver followed suit and approached the key $30.00 mark per ounce, or five-week highs.

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

GBP/USD gains as easing Fed hike bets weigh on US Dollar

GBP/USD continues its winning streak for the ninth consecutive day, trading around 1.3390 during the Asian hours on Tuesday. The currency pair rises as the US Dollar faces headwinds as market participants scale back expectations for Federal Reserve rate hikes this month and in September.

EUR/USD eases toward 1.1400 as Hormuz risks support USD

EUR/USD is easing toward 1.1400 in European trading on Tuesday, facing rejection at the 1.1450 level. The pair loses ground amid a modest recovery in the safe-haven US Dollar, as renewed tensions in the Strait of Hormuz and Asian tech sell-off fuel risk aversion.

Gold sticks to losses as inflation fears lift US bond yields and USD amid Hormuz risks

Gold maintains its offered tone heading into the European session, albeit it holds above the $4,100 mark. Crude oil prices edge higher amid renewed tensions in the Strait of Hormuz, reviving inflationary concerns. This, in turn, triggers a fresh leg up in US Treasury bond yields, offering some support to the US Dollar, and weighing on the non-yielding yellow metal for the second straight day.

Bonk extends correction after $20 million hack from BonkDAO treasury

Bonk remains under pressure, trading below $0.0000044 after losing over 10% in the previous day. Monday’s correction occurred as Bonk Decentralized Autonomous Organization announced a governance exploit that resulted in the theft of $20 million worth of BONK tokens from its treasury.

Bye, forward guidance: How to trade when central banks choose silence

Central banks have spent years telling markets what might come next. Now, traders face the possibility that they say a lot less. From the Federal Reserve to the European Central Bank and the Bank of England, policymakers are pushing back against forward guidance, arguing that the current world demands more flexibility.