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27.05.2024 Market Report


EUR/USD is trading sideways at around 1.0850 in European trading on Monday. A lack of fresh fundamental catalysts and holiday-thinned market conditions leave the pair oscillating in a tight range. 


GBP/USD is trading modestly flat, keeping its range near 1.2750 in the European morning on Monday. The pair is subject to thin liquidity and minimal volatility, courtesy of US and UK market holidays. 


The Japanese Yen (JPY) halted its three-day losing streak, possibly influenced by comments from Bank of Japan (BoJ) Governor Kazuo Ueda on Monday. Ueda remarked that progress has been made in moving away from zero and raising inflation expectations, but there is a need to re-anchor them, this time at the 2% target. He also said that the BoJ will proceed cautiously, aligning with other central banks that have inflation-targeting frameworks.


The Australian Dollar (AUD) extends its gains against the US Dollar (USD) for the second consecutive session on Monday as overall market risk appetite improved, despite diminishing expectations for Federal Reserve interest rate cuts. Meanwhile, investors eagerly anticipate the Monthly Australian Consumer Price Index report on Wednesday, seeking insights into the trajectory of domestic monetary policy.


NZD/USD continues its winning streak for the fourth successive day, trading around 0.6130 during the Asian hours on Monday. The depreciation in the US Dollar (USD) is underpinning the NZD/USD pair, which could be attributed to the improved risk appetite after the softer University of Michigan’s 5-year Consumer Inflation Expectations for May was released on Friday.


The USD/CAD pair trades in a tight range slightly above the crucial support of 1.3650 in Monday’s Asian session. The Loonie asset struggles for a direction as the US Dollar steadies due to holiday mood in the United States economy on account of Memorial Day.


USD/CHF retraces its recent losses that were registered in the previous session, trading around 0.9150 during the European hours on Monday. Traders shifted their focus to the US Dollar (USD) following higher-than-expected Purchasing Managers Index (PMI) data from the United States (US), which dampened risk appetite. The robust data further strengthened the hawkish sentiment surrounding the Federal Reserve (Fed), suggesting the maintenance of higher policy rates for an extended period.


Oil prices steadied in Asian trading on Monday as markets awaited an OPEC+ meeting on June 2 where producers are expected to discuss maintaining voluntary output cuts for the rest of the year.


Gold price is building on the recovery from two-week lows early Monday, as US holiday-induced thin market conditions support buyers. Besides, renewed optimism around China’s economic growth prospects and a fresh escalation in the war between Israel and Hamas provide extra legs to the ongoing rebound in Gold price.

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