Article by: ETO Markets
According to a study released on Wednesday by the Office for National Statistics in the United Kingdom, the Consumer Price Index showed a decrease in inflation from 3.4% in February to 3.2% in March. This reading above the 3.1% market expectation. In addition, the volatile food and energy prices are subtracted from the core CPI, which increased 4.2% during the same time vs the 4.1% increase predicted by analysts. In response to these readings, Pound Sterling gained momentum over its competitors.
Thursday's increase in the ASX 200 Index gives the Australian dollar more traction. Gains in mining firms, backed by stronger metals prices, underpin the local equities market. Furthermore, a Westpac analysis states that even if the Reserve Bank of Australia has said that rate increases are improbable, consideration of rate reductions would need to wait until there is more assurance regarding the inflation forecast.
The decline in the US Dollar Index is mostly attributable to lower US Treasury yields. The market's general risk-on attitude and fresh selling pressure serve to further support the US dollar's decline. Investors are keeping an eye on the weekly Initial Jobless Claims and Existing Home Sales data, which is expected to be released later on Thursday. These reports could offer further information about the US economy and have an effect on the direction of the US dollar.
The price of gold bounces back from its recent lows, trading on Thursday at about $2,370 per troy ounce. Amid increased geopolitical tensions in the Middle East, traders are becoming more cautious, which is helping the safe-haven yellow metal to gain ground.
ECB Board member emphasized the need to wait until June before considering any changes in the ECB, citing the different inflation dynamics between Europe and the US. ECB issued a warning against making hasty assumptions about how frequently the ECB may cut rates in 2024, pointing out that doing so earlier than the Fed could reduce the impact of such actions.
The 4-hour chart indicates that there appears to have been some disagreement on the bearish trend in the … neighborhood. The first support against it is at … , while the second is at ... The first up-barrier is at … in the opposite direction, ahead of … and the 100-SMA at ... Relative Strength Index increased over 55, and Moving Average Convergence Divergence recovered from recent lows.
The Bank of England hinted that the UK is still on course for an interest rate cut, as recent data showed a further easing in the pace of price growth in the economy. On Wednesday, the Office for National Statistics showed that the UK Consumer Price Index dropped to 3.2% in the 12 months to March, the softest level for two-and-a-half years. The figure was down from the previous reading of 3.4%. However, investors expect the first rate cut in August or September.
For the first time in a week, the GBP/USD pair crossed above the 4-hour chart's 20-SMA, and the Relative Strength Index moved closer to 50, indicating a build-up of recovery momentum. On the plus side, immediate resistance is aligned with psychological level ... The GBP/USD pair could continue to rise toward the static level of … and the upper limit of the descending channel, …, if they are able to turn that level into support. The first point of support is situated ahead of ...
