ICM, the leading London-based FX and CFDs provider, reported that the dollar traded in a tight range on Wednesday as the United States was on holiday. The economic calendar is busy these two days with FOMC meeting minutes, Job report, and the US tariff deadline on Chinese imports.
The dollar index which measures the strength of the greenback against a basket of six currencies traded at a one-week low of 94.40 and settled near the opening level at 94.54. A series of economic reports will be released today; we kick-off with the ADP nonfarm employment change for June where analysts anticipate a reading of 190K. Moreover, the ISM non-manufacturing PMI is expected to show the strong momentum of the non-manufacturing sectors. However, the main focus will be on the June FOMC meeting minutes where a hawkish tone could provide support for the US dollar. Investors will also pay attention to the comments on the economic outlook as risks are arising from the trade tensions.
The Euro traded higher against the United States dollar boosted by the news that some ECB officials see that the end of 2019 is too late for a rate hike. EURUSD inched higher to reach a high of $1.1702 ahead of the European session as per ICM trading platform. The interest rate path of the European Central Bank will remain to be data dependent. If inflation numbers pick up towards the price target of the ECB and the risks arising from the trade tensions eased, the chances of an early rate hike will increase.
ICM highlighted that the British Pound rose for the second consecutive day against the greenback after better than anticipated PMI numbers. The week started with better than expected manufacturing PMI. On Tuesday the construction PMI reached the highest reading since December 2017 of 53.1. The series of positive economic data continued with the Services PMI which posted the highest reading since November 2017. As per ICM trading platform, the GBPUSD rose to a high of $1.3249 and settled at $1.3226.
Gold prices ended in green for the second consecutive day, after bouncing-off a seven-month low. However, the gold ounce retreated from a high of $1261 to trade near $1255 during the Asian session. Gold prices will be vulnerable to the economic data from the United States, especially the FOMC meeting minutes as a hawkish tone could provide support to the US Treasury yields and weigh on gold prices. On the other hand, the silver ounce also traded higher for the second consecutive day and settled at $16.05.
Oil prices finished higher on Wednesday, but a tweet from President Donald Trump was enough to erase gains and put prices under pressure. Trump accused OPEC of driving up fuel prices and asked them in a tweet to reduce prices immediately. The West Texas Intermediate closed near the opening levels for the past two days after posting highs and lows which show that there is indecision in the market and that the buyers and sellers are almost in balance. As per ICM cTrader platform, WTI is trading at a low of $73.70, and the Brent oil is trading at a low of $77.61. On the other hand, the Energy Information Administration will report the US weekly crude oil inventories today.