- The US Federal Reserve will be holding a policy meeting later today at which it is almost universally expected to maintain its Federal Funds Rate at 5.50%. However, close attention will be paid to the language of the Fed’s Statement and its Economic Projections which will likely reveal more about the chances for rate cuts at forthcoming meetings later this year. This might give the US Dollar, which has been consolidating over the long term, renewed direction, which would do the same for the Forex market overall.
- The Japanese Yen has continued to fall after the Bank of Japan raised its interest rate for the first time since 2007 yesterday. The USD/JPY currency pair is less than 40 pips from a multi-year high near ¥152 after enjoying a strong rise during the recent Asian session, while the EUR/JPY currency cross has reached its highest level since 2008.
- Stock markets are mostly at least weakly bullish. The main Japanese stock market index the Nikkei 225 has risen again to trade above 40,000 and is not far from its all-time high made just a couple of weeks ago. Yesterday the S&P 500 Index came very close to making a new all-time high.
- In the Forex market, the British Pound and Euro have been the strongest major currencies since the Tokyo open today. The Japanese Yen has been the weakest. This puts the EUR/JPY and GBP/JPY currency crosses in focus today.
- Bitcoin is looking more bearish after making a new all-time high last Thursday just below $74,000. Trend traders will probably have exited any long trades by now.
- In the commodities market, Cocoa futures fell again yesterday but remain within a strong long-term bullish trend. Trend traders will still be keen to be involved in this very long-running trend on the long side.
- Canadian CPI (inflation) data released yesterday was lower than expected, showing only a 0.3% increase over the past month when an increase of 0.6% increase was widely expected.
- There will be 3 important data releases today:
- UK CPI, expected to fall from 4.0% to 3.5%.
- New Zealand GDP, expected to show a quarterly increase of only 0.1%.
- Australian Unemployment Rate, expected to fall from 4.1% to 4.0%.