EURUSD
- EUR/USD rose 0.16% to 1.0927 early in the session, while still testing the 50% Fibonacci level at 1.09427 traced back from January 2021 highs.
- There's little in the way of major economic data due in Europe on Wednesday, and thus stock markets are likely to trade in something of a holding pattern ahead of the U.S. inflation report.
- The general perception is that the Fed is near the end of its aggressive rate-hiking cycle, but there may still be room for another increase in May when policymakers next get together.
| SMA (1D) | Rising |  |
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| RSI (1D) | Slightly Rising | |
|
| MACD (1D) | Neutral |
Closing statement: As investors await the release of the U.S. CPI index, the EUR/USD currency pair is trading cautiously, with the euro slightly up against the U.S. dollar and the focus shifting towards the potential rate hike by the Fed in May.
GBPUSD
- GBP/USD was up 0.1% and traded at 1.2431 in tight trading ranges
- The DXY, which tracks the dollar against six other currencies, traded 0.2% lower to 101.700.
- The Consumer Price Index (CPI) data release for March, published by the US Bureau of Labor Statistics (BLS), is scheduled for today at 14:30 GMT+1.
- The release is expected to show the all-important core inflation, which excludes volatile food and energy prices, rose 0.4% on a monthly basis and 5.6% year-over-year in March.
- Bank of England's Governor Bailey is scheduled to speak today at an online event hosted by the Institute of International Finance and another event about financial and price stability at the IMF Spring Meetings in Washington DC.
GOLD
- Gold prices continued to rise on Tuesday, reaching $2,011 per ounce, up 0.37% on the day, following a limited downward correction due to the dollar's spike after the encouraging NFP report.
- Philadelphia Federal Reserve Bank President Patrick Harker stated that he thinks the Fed may soon be done raising interest rates, while emphasizing that the central bank is committed to bringing down inflation levels.
- The release of the minutes from the last Fed meeting is also of interest, as it could reveal the policymakers' thinking when they hiked rates by 25 basis points last month amidst a banking crisis.
Closing statement: The gold market remains focused on the possibility of further interest rate hikes and the impact they may have on inflation and the broader economy. The release of the Fed minutes tonight may provide further insight into policymakers' thinking on this issue.
CRUDE OIL
- Oil prices stayed near one-month highs on Wednesday as the market waited for fresh cues from US inflation data, and potential build in US crude inventories.
- American Petroleum Institute data showed that US oil inventories unexpectedly grew by 300,000 barrels in the week to April 7, partly due to a 1.6-million-barrel draw from the Strategic Petroleum Reserve.
- Analysts are forecasting a 583,000-barrel draw in US crude oil inventories for the week, which is expected to provide more clarity on inventories in the world’s largest oil consumer.
- The OPEC+ cut and prospect of tighter supplies are keeping the near-term outlook for crude markets bullish.
DAX
- The DAX in Germany is up 0.28%, CAC 40 futures in France are up 0.89%, and FTSE 100 futures contract in the UK are up 0.6%.
- European stock markets are expected to open mostly unchanged as investors remain cautious ahead of the US inflation report that could impact future Fed monetary policy.
- From a technical standpoint, the DAX index is testing resistance at around 15700, and a breakthrough above this level could be a positive signal.
- French central bank chief Francois Villeroy de Galhau warned that euro zone inflation may get entrenched above 2%, and the European Central Bank (ECB) will continue fighting excessive price growth, even as its policy response is shifting gears.
| SMA (1D) | Slightly Rising | |
| RSI (1D) | Slightly Rising | |
| MACD (1D) | Slightly Rising | |
Closing statement: It remains to be seen how the European stock markets will react to the US inflation report, but investors will be closely monitoring the situation as it could have an impact on future monetary policy.