Dollar Falls as Risk Sentiment Recovers Post Navarro
Dollar Falls as Risk Sentiment Recovers Post Navarro
USD
The dollar index, which measures the greenback against a basket of major currencies, drifted lower to 96.82 as investors favored riskier currencies. During the Asian session, risk currencies dived as the White House trade adviser Peter Navarro stated that the deal with China was over. However, they recovered and the dollar lost ground as he clarified that his comments were taken out of context. The risk-sensitive AUDUSD rose to $0.6935 from $0.6858, the EURUSD edged higher to $1.1302, and the GBPUSD rallied to $1.2507.
Equities
Major US stock index futures resumed upside rally after plunging sharply on Navarro’s comments over China. The latter clarified that his comments have been taken wildly out of context, supporting the market to restore confidence. Also, President Trump tweeted that the China trade deal is fully intact, which boosted risk sentiment again. The Dow Jones Industrial Average futures rose to 26165 from 25513, the S&P500 futures advanced to 3133, and Nasdaq futures ascended to another record high of 10193.
Metals
Precious metal prices firmed as the dollar continued to weaken. The price of a gold ounce rose to $1763, the highest since May 18, and a couple of dollars short from trading at the highest level since late 2012, the price of a silver ounce rallied to $18.03, and palladium futures held steady near $1945.
Oil
Oil prices extended gains supported by optimism over the economic recovery. The West Texas Intermediate crude August delivery rose to $41.22, the highest since the plunge in March, and Brent Blend August delivery advanced to $43.49.
Major Economic Events
| GMT | Country | Event | Expectation | Previous |
|---|---|---|---|---|
|
8:30 |
UK |
Manufacturing PMI |
45.2 |
40.7 |
|
8:30 |
UK |
Services PMI |
39.1 |
29 |
|
8:45 |
UK |
BoE Gov Bailey Speaks |
- |
- |
|
13:45 |
US |
Manufacturing PMI (Jun) |
48.0 |
39.8 |
|
13:45 |
US |
Services PMI (Jun) |
46.5 |
37.5 |
|
14:00 |
US |
New Home Sales (MoM) (May) |
3.5% |
0.6% |
|
20:30 |
US |
API Weekly Crude Oil Stock |
- |
3.900 |
Disclaimer
The prices and news mentioned in this outlook are absolutely no guarantee of future market performance and do not represent the view of ICM.COM. Financial markets can move in either direction causing profits to be made or complete losses to be incurred by the trader. Each trader must decide for themselves what their risk appetite is and ensure that correct risk management procedures are in place before placing any trades.
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