Forex News Roundup for 13 June, 2023

My FX List
June 14, 2023
    • The focus of market participants is on the release of the US Consumer Price Index (CPI) data. This data is crucial in determining the level of inflation in the country. Analysts anticipate that the annualized rate of inflation will decline from 4.9% to 4.1%. If the actual figure aligns with these expectations, it could potentially result in a significant positive real interest rate in the United States.
    • In a surprising move, the People’s Bank of China has lowered its 7-day reverse repo rate from 2.0% to 1.9%. This unexpected rate cut is seen as a contributing factor to the generally optimistic outlook in stock markets. It has likely played a part in creating a bullish sentiment among market participants.
    • This week, the three major central banks, namely the US Federal Reserve (Fed), the European Central Bank (ECB), and the Bank of Japan (BoJ), will be convening for their policy meetings. As a result, we can anticipate increased volatility in the Forex market, with the impact expected to be noticeable from later today onwards.
    • The prevailing sentiment in global stock markets is optimistic, driven partly by the anticipation of reduced US inflation and the absence of an expected rate hike in the upcoming period. Notably, the US and Japanese stock markets have demonstrated substantial growth, reaching new long-term highs. The NASDAQ 100 Index and the Nikkei 225 Index are noteworthy examples, as both have surged by over 1.5% on the day.
    • The Turkish Lira experienced yet another significant decline, reaching a new all-time low. This recent depreciation follows a continuous weakening trend that began as President Erdogan’s election victory started to appear more probable.
    • Global stock markets are currently displaying a bullish trend, influenced in part by expectations of lower inflation in the United States and the likelihood of no imminent interest rate hike. The US and Japanese stock markets have experienced significant upswings, propelling them to achieve new long-term highs. Noteworthy performances include the NASDAQ 100 Index and the Nikkei 225 Index, both of which have registered gains exceeding 1.5% on the day.
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