The Dollar Index is trading almost flat
The Dollar Index is trading almost flat during the early part of Wednesday’s session. The relative stillness of the greenback comes as many are already looking towards tomorrow’s publication of the US CPI for May. Should it provide a shockingly high number, this could force the hand of the Fed in accepting the need for earlier tapering of its current dovish policies. On the other hand, should the inflation figure come in below feared levels, the central bank will feel vindicated in its approach, with the US dollar likely to lose support in such a scenario.
Ricardo Evangelista – Senior analyst, ActivTrades
Stocks fluctuated with lower volumes than usual in Europe on Wednesday, following a mixed trading session in Asia where losses in Japan were offset by gains from Chinese shares. While investors search for new bullish catalysts to drive stock prices higher, there are still no significant bearish market drivers to trigger a sell-off either. More and more traders, who may have initially been skeptical towards the “transitory” effect of inflation, now start to consider the possibility that central banks may have been right to display such confidence about the current mounting price pressure. Of course, investors will still need some confirmation, like tomorrow’s US CPI report, before taking any decision on how to manage their exposure towards riskier assets. Meanwhile, energy and Forex traders will be focusing on today’s US Crude Oil Inventories data as well as the Bank of Canada’s decision on rates where a surprise is always possible.
Pierre Veyret– Technical analyst, ActivTrades
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 futures performance. AT provides an execution-only service. Consequently, any person acting on the information provided does so at their own risk