Market Analysis

Dollar trading flat amidst cautious investors sentiments

FOREX

The US dollar is trading flat as the European session gets underway. After dropping more than 1% during the previous seven days the dollar index is starting the week without significant movement, illustrating investors’ settled expectations on a 75bp rate hike by the Federal Reserve later this week. After the turmoil of previous weeks, when the prospect of a rate rise of 100bp was at some point seen as realistic, the waters are now calmer as it is seen as most likely that the Fed will not deliver any surprises on Wednesday and will increase rates by 75bp. The main point of interest will instead be the tone adopted by Jerome Powell, with observers keen to gauge the sentiment within the central bank and adjust expectations for the times ahead.

Source: ActivTrader

 

GOLD

Gold prices have barely moved during early Monday trading, reflecting the performance of the US dollar, which is also trading flat. Market expectations have settled on a 75bp rate hike by the Federal Reserve this Wednesday, and so the mood in the markets is now calmer, contrasting with the greater turbulence of previous weeks, when a rate rise of 100bp points was, at some point, seen as likely. With demand for the dollar having stabilized, and growing concerns over the prospect of an economic slowdown forcing central banks to re-think the tightening of monetary policies, gold is finding some support, with more clarity likely after Wednesday’s speech by Jerome Powell, which is expected to provide clues for what will be the Fed’s stance in the weeks ahead.

Source: ActivTrader

 

The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and as such is to be considered to be a marketing communication.

All information has been prepared by ActivTrades (“AT”). The information does not contain a record of AT’s prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.

Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not a reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk.