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29.05.2024 Market Report


EUR/USD stays depressed near 1.0850 in the European morning on Wednesday. The pair faces challenges as the US Dollar gains further ground amidst emerging risk aversion, fuelled by reduced Fed rate cut expectations and rife Middle East tensions. German inflation data is next in focus. 


GBP/USD trades with mild losses around 1.2760 during the Asian session on Wednesday. The modest recovery of the US Dollar and US yields amid the diminishing expectations of a rate cut by the US Federal Reserve in September weighs on the major pair.


The Japanese Yen (JPY) continues to weaken on Wednesday, influenced by a broad market downturn driven by risk aversion sentiment. Furthermore, Bank of Japan (BoJ) board member Seiji Adachi maintained his dovish stance during a speech, potentially contributing to the JPY’s decline and supporting the USD/JPY pair.


The Australian Dollar (AUD) pared its daily losses after the higher-than-expected Monthly Consumer Price Index was released on Wednesday. This strong data could prompt the Reserve Bank of Australia (RBA) to consider another rate hike. The minutes from the RBA’s May policy meeting suggested that the central bank had contemplated a potential interest rate increase.


NZD/USD eased back into the 0.6140 level in early Wednesday trading as Kiwi traders await a reason to move. The economic calendar is notably thin except for the NZ government’s latest Budget Release on Thursday, leaving NZD traders adrift until Friday’s speech from Reserve Bank of New Zealand (RBNZ) Governor Orr.


USD/CAD edges higher for the second consecutive day, trading around 1.3650 during the Asian hours on Wednesday. The emergence of risk aversion drives investors toward the US Dollar (USD), underpinning the USD/CAD pair.


The USD/CHF pair trades flat around 0.9125 during the early European session on Wednesday. Traders remain cautious ahead of the crucial inflation readings this week. Later on Wednesday,  the Fed’s Beige Book will be released, and the Fed’s John Williams is scheduled to speak.


Oil prices rose in Asian trading on Wednesday on expectations major producers will maintain output cuts at a meeting this Sunday, and that fuel consumption should begin rising with the start of the peak summer demand season.


Gold price is posting small losses below $2,360, pausing a three-day recovery early Wednesday. The US Dollar resurgence acts as a headwind for the Gold price, despite heigthening Middle East tensions and a pick up in Indian physical Gold demand.

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