The US Dollar weakened modestly further yesterday. Nonetheless, economists at MUFG Bank expect the EUR/USD rally to fade as the pair nears the 1.10 mark.It is difficult to envisage the current divergence in policy expectations being sustained
“It is difficult to envisage the current divergence in policy expectations being sustained if the data from the US remains resilient.”
“The OIS market currently implies 50 bps of hikes by the ECB by September while the market is 80% priced for a 25 bps rate cut from the Fed by then. Without further banking sector turmoil, data flow will dictate the sustainability of that degree of divergence in policy expectations and based on the consumer confidence data there is a greater risk of that divergence closing which could see EUR/USD again run out of steam as we move toward the 1.1000 level.”EUR/USD edges higher toward 1.0850 amid upbeat mood
EUR/USD is advancing toward 1.0850, as risk flows gather steam in the European session. Hawkish ECB commentary also aids the Euro’s uptick while the upside could be capped by a broad rebound in the US Dollar. US housing data eyed.
GBP/USD rebounds toward 1.2350 as risk rally picks up steam
GBP/USD is rebounding toward 1.2350, resuming the upside in European trading hours. The upbeat market mood, led by easing banking jitters, is underpinning the risk currency – the Pound Sterling, despite a broad-based US Dollar rebound.
Gold and Silver prices consolidate ahead of high-stakes events on Friday
Precious metals are consolidating this week after seeing enormous gains since the beginning of March. Gold price (XAU/USD) is trading comfortably above $1,950 after having peaked around the thick $2,000 round resistance.
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