The Fed Raised the Interest Rate. We Are Waiting for the ECB Decision

The US dollar weakened against the basket of major currencies despite the Fed interest rate decision. The dollar index (#DX) closed the trading session with a slight decrease (0.26%). As expected, the regulator raised the interest rate by 25 basis points to 1.75%2.00%. In general, Fed officials note the strengthening of the labor market and the growth of economic activity in the US. The Central Bank representatives pointed at two rate increases by the end of 2018. However, the reaction of the dollar was rather lowkey. Investors partially fixed the previously received profit. At the moment, financial market participants are waiting for the ECB comments on monetary policy. Today we expect high trading activity and volatility.

Yesterday, important economic statistics from the UK and the US were also published. In May, the consumer price index in the UK remained at the same level of 2.4% (yearonyear), as experts expected. The indicator retains the annual low. The producer price index in the US rose to 0.5% instead of the forecasted value of 0.3% in May.

Today, during the Asian trading session, a report on the employment change in Australia has been also published, according to which the number of employees in May slowed down to 12K, while experts expected the increase to 18.8K. The growth in China’s industrial production counted to 6.8%, which is below the market expectations of 6.9%.

The “black gold” prices are consolidating after the growth the day before. At the moment, futures for the WTI crude oil are testing a mark of $66.60 per barrel.

Market Indicators

Yesterday, there was a variety of trends in the US stock market: #SPY (+0.32%), #DIA (0.44%), #QQQ (0.01%).

At the moment, the 10year US government bonds yield is at the level of 2.952.96%.

Report on retail sales in the UK at 11:30 (GMT+3:00);ECB interest rate decision at 14:45 (GMT+3:00);Statistics on retail sales in the US at 15:30 (GMT+3:00).

by JustMarkets, 2018.06.14