Things to watch out for on Friday, February 10:
The US dollar gained ground ahead of the Wall Street open and accelerated late in the day as US stocks fell before the close. The most noticeable decrease was XAU/USD, which hit a new weekly low of $1,859.72 a troy ounce. It bounced modestly from this level, but is trading at its lowest level in over a month.
The EUR/USD pair approached 1.0800 but gave back to the level and trades around 1.0740. The German Harmonized Index of Consumer Prices (HICP) unexpectedly rose 9.2% yoy in January, below the 10% forecast and down from 9.6% previously.
The dollar benefited from the rise in government bond yieldsbut also from the comments of the president of the Richmond Federal Reserve, Thomas Barkin, who affirmed that the effects of the tightening of the Fed’s monetary policy have been substantial, while adding that the macroeconomic data removed the risk of recession.
For now, the 10-year Treasury yield stands at 3.67%, up 4 basis points, while the 2-year yield is trading at 4.50%, up 5 basis points.
GBP/USD topped out at 1.2191, holding the gains, but currently trades around 1.2120. The Bank of England (BoE) Monetary Policy Report provided support for the pound. Governor Andrew Bailey, Chief Economist Huw Pill and Chief Monetary Policy Officer Jonathan Haskel testified before the UK Treasury Select Committee. However, Silvana Tenreyro, head of monetary policy, later noted that, in his view, rates are now too high and that a massive recession would be needed to bring inflation down to 2%. He finally added that he would consider a rate reduction.
Japanese Prime Minister Kishida is expected to name a successor of the governor of the BOJ Kuroda , next week. Speculation is swirling as to whether Kishida will choose a more aggressive central bank leader to end ultra-loose monetary policy. The Japanese yen lost ground in the Americas, with USD/JPY trading around 131.50, after falling to an intraday low of 130.33 earlier in the day.
Commodity-linked currencies pared early gains against their US rival. The AUD/USD pair is trading around 0.6940, while the USD/CAD pair stands at 1.3450.
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Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
