Current Market Trends

Market Overview

The Swiss National Bank (SNB) cut rates yesterday from 1.5% to 1.25%, causing CHF weakness. Meanwhile, the NZ Dollar finds stability as GDP q/q finds growth of 0.2, a recovery from last results of  -0.1%.

The Bank of England (BOE) held rates steady but got nearer to cutting rates. Markets currently price in a probability of around 47% that the BOE will cut rates in August, versus around 36% just before the decision, Refinitiv data show. 

Meanwhile, hawkish comments Thursday from Minneapolis Fed President Kashkari were bullish for the dollar when he said it would likely take a year or two for the US to get back to 2% inflation. However, weaker data releases caused a decline in the performance of the dollar. Unemployment came out at 238,000 -- higher than expected by 3,000 but weaker by 5,000 than last month's data release.

US May housing starts unexpectedly fell -5.5% m/m to a 4-year low of 1.277 million, weaker than expectations of an increase to 1.370 million. May building permits, a proxy for future construction, unexpectedly fell -3.8% m/m to a 4-year low of 1.386 million, weaker than expectations of an increase to 1.450 million.

The US June Philadelphia Fed business outlook survey unexpectedly fell -3.2 to a 5-month low of 1.5, weaker than expectations of an increase to 5.0.

The markets are discounting the chances for a -25 bp rate cut at 10% for the July 30-31 FOMC meeting and 61% for the following meeting on Sep 17-18.

GOLD -Gold has broken through 2332.174 with strong momentum, now eyeing 2365.443. Despite hawkish comments from the Fed, confidence in the U.S. economy is waning, possibly due to central banks diversifying away from the dollar amid rising geopolitical tensions. The fundamental outlook for Gold remains bullish.

SILVER -Silver has mirrored Golds strength, breaking through 29.900 and approaching 30.938. The bullish momentum is expected to continue as the market sentiment remains positive.

DXY - The Dollar Index remains range-bound between 105.840 and 105.071. We await further price prints for direction. Upcoming Flash Manufacturing and Services PMI data will likely influence USD prices.

GBPUSD - The GBP fell to 1.26602 despite steady rates, pressured by hawkish dollar comments. The BOEs dovish stance suggests potential further declines, although the UK economy is seen as relatively strong.

AUDUSD - The Australian Dollar remains resilient, trading above 0.66541 despite hawkish Fed comments. Further price action will clarify the market's direction.

NZDUSD -The NZ Dollar has strengthened on positive GDP q/q results, maintaining its position above 0.60954. The market remains in consolidation, awaiting further price prints to determine direction.

EURUSD - The Euro has weakened, falling below 1.07240 and returning to a downward trendline. The bearish technical structure suggests further declines.

USDJPY -USDJPY is climbing closer to intervention levels last seen by the BoJ. The Yen shows weakness as the price moves upward, with Japan's MoF official Kanda issuing an intervention warning if excessive FX movements occur.

USDCHF -Following rate cuts, the CHF is weak, with USDCHF trading back above 0.88886. The market is expected to be bullish as we await further price movements.

USDCAD - The Canadian Dollar has recovered against the USD, pushing prices closer to 1.36563. Further price action is needed to determine the next move.