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11.05.2023 Market Report


EUR/USD takes offers to refresh the intraday low around 1.0970 as it pares the previous day’s rebound from the weekly low heading into Thursday’s European session. The Euro pair fails to justify the hawkish expectations from the European Central Bank (ECB).


GBP/USD retreats from intraday high while slipping back to 1.2620 as it inks the market’s cautious mood ahead of the all-important Bank of England (BoE) monetary policy meeting. The Pound Sterling pair remains unchanged on a day heading into the London open on “Super Thursday”.


USD/JPY fails to justify dovish signals from the Bank of Japan’s (BoJ) latest update as bears keep the reins while refreshing weekly low around 133.90 during early Thursday. In doing so, the Yen pair takes clues from the broad US Dollar weakness amid cautious optimism and downbeat Treasury bond yields.


AUD/USD takes a U-turn from the intraday high of near 0.6800 as bulls struggle to cheer upbeat inflation clues from Australia amid mixed China data published early Thursday. However, the softer US inflation and hawkish statements in the Reserve Bank of Australia (RBA) documents released under the Freedom of Information (FOI) request keep the Aussie pair buyers hopeful.


The Kiwi put in another reasonable performance overnight against the USD. It remains the best-performing G10 currency week to date. As-expected US CPI data came as a relief to markets, and while it was enough to see US bond yields fall, the subsequent fall in equities and commodities dimmed the impact on risk currencies, with the USD DXY paring losses quickly


USD/CAD pares the previous day’s losses inside the weekly trading range surrounding 1.3400 amid early Thursday, mildly bid when refreshing intraday high near 1.3385 by the press time. That said, the Loonie pair’s latest gains could be linked to the downbeat Oil price and the US Dollar’s consolidation of inflation-led losses ahead of the US Producer Price Index (PPI) for April. However, the pair sellers remain hopeful amid dovish from the US Federal Reserve (Fed), especially after the previous day’s downbeat US Consumer Price Index (CPI) details.


USD/CHF extends its bearish downtrend, though it appears to consolidate around the year-to-date (YTD) lows at around the 0.8800 handle after US data showed that prices are edging lower. In addition, hawkish rhetoric from the Swiss National Bank (SNB) Governor was cheered by USD/CHF bears. The USD/CHF is trading at around the 0.8890s area.


Oil prices rose in Asian trade on Thursday tracking a weak dollar and signs of improving U.S. fuel demand, although softer-than-expected Chinese inflation data limited major gains. The dollar slid in overnight trade as data showed U.S. inflation continued to decline through April, spurring bets on an imminent pause in the Federal Reserve’s rate hike cycle. A weaker dollar makes crude more attractive for international buyers, sprucing up demand.


Gold price stays on the way to posting a three-week uptrend despite the previous day’s retreat from the key $2,050 mark. In doing so, the precious metal buyers benefit from the softer US inflation numbers and the downbeat US Dollar.

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