The Probability of Tightening the Fed Monetary Policy Came Down

Last week, the US dollar weakened against the major world currencies. On Friday, July 14, weak economic reports from the United States were published. In June, the base consumer price index was 0.1%, which is less than the forecasted value of 0.2%. The volume of retail sales decreased by 0.2%. Experts expected the growth rate of 0.1%. The probability of increasing the range of the Fed key interest rate in December of this year fell to 43.1%.

The best results were demonstrated by the Canadian dollar. It should be recalled that the Bank of Canada increased its interest rate by 25 basis points to 0.75%. The regulator raised the forecast for the country’s GDP growth. Support is also provided by the oil quotations recovery. At the moment, futures for the WTI crude oil are being traded above $46.5 per barrel.

In the Asian trading session, positive statistics on China’s economy was published. In the second quarter, the country’s GDP growth (in annual terms) was 6.9%, exceeding market expectations at 6.8%. In June, the volume of industrial production (in annual terms) increased by 1.1% to 7.6%.

This week, the attention will be focused on meetings of the Bank of Japan and the ECB.

Market Indicators

On Friday, the US stock market closed in the positive zone. SPY (SPDR S&P500 ETF) increased by 0.47%.

At the moment, the 10year US government bonds yield is at the level of 2.322.33%.

The dollar index (#DX) closed the trading session in the negative zone (0.61%).

News background

Today, the attention of the financial markets participants will be directed to the report on inflation in the Eurozone 12:00 (GMT+3:00).

by JustMarkets, 2017.07.17