US Market Wrap: FOMC waits for sun, moon and stars to align
- Japan: BoJ Interest Rate decision and statement 2000 GMT
- PPI May (actual 0.4% vs. forecast 0.3%; ex food and energy, actual 0.3% vs forecast 0.1%, m/m)
- Industrial Production May (Actual minus 0.4% vs. forecast minus 0.2%)
- Capacity Utilisation May (Actual 74.9% vs. Forecast 75.2%)
- EIA Crude Stocks Change (Actual minus 0.933 m/b vs forecast minus 2.26 m/b)
FX Traders had a “rethink” of this week's moves and dialled back their risk-averse, US dollar buying sentiment. US dollars were sold against EUR, GBP and JPY during the morning with weak US Industrial Production data supporting the move. Selling dollars proved to be a smart move.
The Federal Open Market Committee left rates unchanged and delivered a dovish statement to go along with downgraded economic projections. EURUSD soared, USDJPY sank and both currency pairs returned to the pre-FOMC statement levels. Next up is the Bank of Japan.
Oil prices had a wild to-ing and fro-ing session, dropping as the US dollar rose then soaring after the EIA announced a draw-down in crude stocks. WTI peaked at $48.70/barrel and then dropped steadily in the afternoon, closing at $47.45.
US equity traders were not amused. The dovish Federal Reserve didn’t surprise a whole lot of people but the uncertainty surrounding the upcoming Brexit vote has traders a tad antsy. The three major indices all finished in the red.
with downgraded economic projections. Photo: iStock
– Edited by Gayle Bryant
Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to engage with Saxo Bank's social trading platform.
Missed a day? Here’s what we had to say during our Asian session and our regular European Morning Markets, From the Floor and Mid-session Europe.