Will we see end-of-month rebalancing activity following the ECB Forum, or will we wait and see?
29.06.2023
- U.S. First-Quarter GDP
- U.S. Initial Jobless Claims
In yesterday’s U.S. currency trading, the U.S. dollar rose slightly against the yen after Federal Reserve Chair Powell stated at the ECB Forum held yesterday that “the year-over-year increase in the core inflation rate is unlikely to fall to 2% until 2025 or later,” signaling a continued stance toward interest rate hikes.The USD/JPY pair rose from 143.271 to 144.616, setting a new high for the year. As the pair continues to find support at the 10-period moving average on the 4-hour chart during today’s Asian session, we will be watching price movements closely during the European session.
European currencies fell as the euro dropped against the U.S. dollar following the release yesterday of Germany’s July GfK Consumer Confidence Index, which came in at -25.4—a further decline from the previous month’s -24.2. The EUR/USD pair fell by approximately 70 pips from 1.0961 to 1.0897.This effectively offset the gains made the day before yesterday. Since the EUR/USD pair has already broken below the 75-period moving average (MA) on the 4-hour chart, traders should be wary of further declines during European trading hours.
Today’s schedule includes remarks by Fed Chair Powell at 3:30 p.m., the ECB’s monthly report at 5:00 p.m., UK consumer credit at 5:30 p.m., the Eurozone consumer confidence index at 6:00 p.m., South Africa’s producer price index at 6:30 p.m., and Germany’sConsumer Price Index, at 9:30 PM U.S. Initial Jobless Claims, U.S. Q1 GDP, U.S. Personal Consumption Expenditures, and U.S. Pending Home Sales; at 11:30 PM U.S. Weekly Natural Gas Inventories; at 1:30 AM U.K. MPC Member Tenreyro’s remarks; and at 4:00 AM U.S. Atlanta Fed President Bostic’s remarks.We will carefully monitor currency strength and weakness to see if end-of-month rebalancing activity occurs.
Author: Keisuke Sakurai
