All eyes are on whether the release of the FOMC minutes will cause significant movement in the U.S. dollar

All eyes are on whether the release of the FOMC minutes will cause significant movement in the U.S. dollar

24.05.2023

In the U.S. currency market yesterday, the dollar fluctuated against the yen after the Richmond Fed Manufacturing Index for May, released yesterday, came in at -15—worse than the market forecast of -9. The USD/JPY pair traded between 138.910 and 138.229, showing a lack of direction as it hovered around the 20-period moving average on the hourly chart.From a technical perspective, the USD/JPY pair is showing RSI divergence on the 4-hour chart, so we should be wary of a pullback during European trading hours.

European currencies saw the euro fall slightly against the U.S. dollar after mixed results were released yesterday for Germany’s May manufacturing and services PMIs. The EUR/USD pair fell from 1.0819 to 1.0760, trading just below the 20-day moving average on the weekly chart.From a technical perspective, the EUR/USD pair is showing signs of divergence on the 4-hour chart as the RSI has touched the 30 level, so we will be watching for a potential rebound in the euro during U.S. trading hours.

Today’s schedule includes the UK Consumer Price Index, UK Retail Price Index, and UK Producer Price Index at 3:00 PM; Turkey’s Capacity Utilization Rate at 4:00 PM; Germany’s IFO Business Climate Index at 5:00 PM; remarks by Bank of England Governor Bailey at 6:30 PM; the U.S. MBA Mortgage Applications Index at 8:00 PM;a speech by U.S. Treasury Secretary Yellen at 11:05 PM, U.S. weekly crude oil inventories at 11:30 PM, a speech by U.S. Federal Reserve Governor Waller at 1:10 AM, a U.S. 5-year Treasury auction at 2:00 AM, a speech by ECB President Lagarde at 2:45 AM, and the release of the FOMC minutes at 3:00 AM.We will be closely monitoring whether the release of the FOMC minutes triggers significant movement in the U.S. dollar.