• Global markets remain dicey as traders await more clues to confirm economic slowdown.
  • US 10-year Treasury yields remain inactive, stock futures in the US, Europe print mild losses.
  • Fed’s Powell failed to impress greenback bulls, chatters surrounding BOJ dominate bond markets.
  • Preliminary readings of June’s PMIs, second round of Powell’s Testimony will be important for fresh directions.

Fears of economic setback keep traders on their toes during early Thursday morning in Europe. The market’s pessimism, however, lacked major data/events during the Asian session and hence magnified the inaction. Additionally restricting the moves could be the cautious sentiment ahead of the first readings of the monthly PMIs from the Eurozone, the UK and the US.

With this, the US 10-year Treasury yields dropped the most in one week the previous day before portraying inaction at around 3.15% by the press time. Further, the S&P 500 Futures drop 0.20% to 3755 whereas the Eurostoxx 50 Futures print a 0.40% intraday fall at the latest.

Be it recently downbeat data from the major economies or the fears of a further supply crunch, global traders fear that the economic slowdown is a next-door enemy. Adding to the market fears are confirmation of the further aggression of central bankers, recently confirmed by the US Federal Reserve (Fed) Chairman Jerome Powell.

Fed’s Powell considered the present monetary policy bias appropriate to battle the inflation woes. It’s worth noting, however, that the Fed Boss’s readiness to use the aggressive measures, irrespective of their consequences, seemed to have put a floor under the greenback. On the same line is the latest news from Reuters signaling an upbeat print of June’s jobs report.

Policymakers from the European Central Bank (ECB), Swiss National Bank (SNB), Bank of Canada (BOC) and the Bank of England (BOE) were also suggesting further rate hikes during the latest appearance.

An exception amid the aggressive central banks, namely the Bank of Japan (BOJ), fails to gain the market’s sympathy as the bond market suggests the foreign funds’ exit from Japanese Treasuries, which in turn pushes the last stone to turn.

Elsewhere, fears of German economic contraction due to the maintenance-linked halt of Russian gas supplies join pessimism surrounding China’s economy and the Sino-American trade prospects to weigh on the market sentiment.

However, traders await the preliminary readings of June’s activity numbers from the key economies to confirm the bearish bias. Also important to watch will be the UK’s by-elections and the second round of Fed Chair Powell’s testimony, not to forget the weekly prints of the US jobless claims.

Also read: Recession fears dominate

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 steadies near 1.0550, looks to post modest weekly gains

EUR/USD steadies near 1.0550, looks to post modest weekly gains

EUR/USD has lost its bullish momentum after having climbed above 1.0570 with the initial reaction to the US data in the American session and retreated toward the mid-1.0500s. On a weekly basis, the pair remains on track to close in positive territory. 

EUR/USD News

GBP/USD struggles to hold above 1.2300

GBP/USD struggles to hold above 1.2300

GBP/USD has edged lower following a jump above 1.2300 in the early American session on Friday. The market mood remains upbeat ahead of the weekend with Wall Street's main indexes posting strong daily gains on upbeat US data. 

GBP/USD News

Gold stays below $1,830 as US yields edge higher

Gold stays below $1,830 as US yields edge higher

Gold continues to fluctuate below $1,830 on Friday and looks to close the second straight week in negative territory. Fueled by the risk-positive market environment, the benchmark 10-year US Treasury bond yield is up more than 1% on the day, limiting XAU/USD's upside.

Gold News

Why Cardano could surprise over the weekend

Why Cardano could surprise over the weekend

ADA  set to close out the week with a gain on the workday trading week and over the weekend? Central banks signaled that the rate hike cycle is ending, meaning less stress and tight conditions for trading, opening up room for some upside potential with Cardano set to pop above $0.55 and test a significant cap.

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!

BECOME PREMIUM

Forex MAJORS

Cryptocurrencies

Signatures