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America’s Roundup: Dollar gains on hawkish comments from Powell, Wall Street ends mixed, Gold little changed, Oil slides 2% on rising U.S. fuel stocks and output-June 30th,2022

Market Roundup

• US Core PCE Prices (Q1) 5.20%  ,5.10% forecast, 5.10% previous

• US Corporate Profits (QoQ) (Q1) -4.9%,-4.3% previous

• US GDP Price Index (QoQ) (Q1) 8.3%,8.1% forecast, 8.1% previous

• US GDP (QoQ) (Q1) -1.6%,-1.5% forecast, -1.5% previous

• US GDP Sales (Q1) -1.2%,-0.5% forecast, -0.4% previous

•US  Cushing Crude Oil Inventories -0.572M, -0.826M previous

• US Crude Oil Inventories -0.386M , 1.956M previous

• US Cushing Crude Oil Inventories -0.782M, -0.572M previous

Looking Ahead Economic Data(GMT)     

•23:50  Japan May Industrial Production (MoM)  -0.3%forecast, -1.5% previous

•23:50 Japan Foreign Bonds Buying -496.7B previous

•01:00 NZ Jun ANZ Business Confidence   -55.6

•01:30 China Jun Non-Manufacturing PMI   47.8

•01:30 AU May Private Sector Credit (MoM)   0.8%

•01:30 China Jun Manufacturing PMI  50.5 forecast,49.6 previous

•01:30 China Jun Chinese Composite PMI  48.4 previous

•05:00 Japan May Construction Orders (YoY)  30.5% previous

Looking Ahead - Events, Other Releases (GMT

•No significant events

Currency Summaries

EUR/USD: The euro declined on Wednesday after European Central Bank President Christine Lagarde said the era of ultra low inflation that preceded the pandemic is unlikely to return.Speaking at a panel at the ECB Forum in Sintra, Portugal, alongside U.S. Federal Reserve Chairman Jerome Powell and Bank of England Governor Andrew Bailey, Lagarde added that central banks need to adjust to significantly higher price growth expectations. The euro was last down 0.41% to $1.0442. It had dropped to as low as $1.0486 earlier in the day after data showed June prices in the German state of North Rhine–Westphalia (NRW) had been 0.1% lower than in May. Immediate resistance can be seen at 1.0506(20DMA),an upside break can trigger rise towards 1.0621(38.2%fib).On the downside, immediate support is seen at 1.0404(38.2%fib), a break below could take the pair towards 1.0362(50%fib).

GBP/USD: Sterling fell against dollar on Wednesday as dovish comments from a new policymaker kept the currency firmly on course for its biggest six-month decline against the dollar since 2016, the year of the Brexit referendum.Swati Dhingra, who will join the BoE in August, said the bank should move to tightening policy very gradually as there are signs  an economic slowdown that is much closer than previously thought. Sterling has been one of this year’s worst performing major currencies, down more than 10% against the dollar. Immediate resistance can be seen at 1.2156(38.2%fib),an upside break can trigger rise towards 1.2199(5DMA).On the downside, immediate support is seen at 1.2037(16th June Low), a break below could take the pair towards 1.1941(23.6%fib).

USD/CAD: The Canadian dollar fell against its broadly stronger U.S. counterpart on Wednesday, giving back some recent gains as the prospect of a global economic slowdown weighed on investor sentiment .The safe-haven U.S. dollar climbed against a basket of major currencies as Federal Reserve Chair Jerome Powell said there is a risk the U.S. central bank's effort to tame persistently high inflation with interest rate hikes will slow the American economy too much. The Canadian dollar was trading 0.2% lower at 1.2895 to the greenback, following three straight days of gains.  Immediate resistance can be seen at 1.2895 (5 DMA), an upside break can trigger rise towards 1.2925 (23.6%fib).On the downside, immediate support is seen at 1.2822 (38.2%fib), a break below could take the pair towards 1.2793 (30DMA).

USD/JPY: The dollar strengthened against the Japanese yen on Wednesday as hawkish comments by U.S. Federal Reserve policymakers boosted greenback. Fed chair Jerome Powell on Wednesday stuck to the central bank's hawkish stance citing surging inflation as a bigger risk. This followed hawkish comments from Fed policymakers pushing for big and faster interest rate hikes, denting risk appetite and lifting the dollar. A Commerce Department report on Wednesday showed that the U.S. economy contracted slightly more than previously estimated in the first quarter as the trade deficit widened to a record high and a resurgence in COVID-19 infections hurt spending on services like recreation Strong resistance can be seen at 137.11 (23.6%fib), an upside break can trigger rise towards 138.00(Psychological level).On the downside, immediate support is seen at 136.16(50%fib), a break below could take the pair towards 135.92(5DMA).

Equities Recap

European shares fell on Wednesday, as fears about a global recession deepened after chiefs of the European Central Bank and U.S. Federal Reserve Chairman stuck to their hawkish stance.

UK's benchmark FTSE 100 closed down by 0.15 percent, Germany's Dax ended down  by 1.73 percent, France’s CAC finished the day down by 0.15 percent.

The S&P 500 ended a seesaw session slightly down on Wednesday as investors staggered toward the finish line of a downbeat month, a dismal quarter, and the worst first-half for Wall Street's benchmark index since President Richard Nixon's first term.

Dow Jones closed up by  0.27% percent, S&P 500 closed down by 0.07% percent, Nasdaq settled up by 0.03%  percent.


Treasuries Recap

U.S. Treasury yields eased for a second consecutive day and the dollar rose on Wednesday after Federal Reserve Chairman Jerome Powell said there is a risk the U.S. central bank's interest rate hikes will slow the economy too much, but the bigger risk is persistent inflation.

The yield on 10-year Treasury notes fell 10.5 basis points to 3.102%, while the two-year's yield slid 6.5 basis points to 3.059%.

Commodities Recap

Gold prices see-sawed on Wednesday, caught between headwinds from aggressive interest rate hikes and support from safe-haven bids spurred by growing recession risks

Spot gold fell 0.2% to $1,816.39 per ounce by 1:56 p.m. ET (1756 GMT).U.S. gold futures also settled down 0.2% to $1,817.5.

Oil prices fell about 2% on Wednesday as rising US gasoline and distillate inventories and concerns about slowing economic growth around the world offset lingering concerns over tight crude supplies.

Brent futures for August delivery fell $1.72, or 1.5%, to settle at $116.26 a barrel. The August contract will expire on Thursday and the more-active September contract was down $1.35 to $112.45.

U.S. West Texas Intermediate crude for August fell $1.98, or 1.8%, to settle at $109.78.



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