What you should know on Tuesday, May 17:
The US dollar appreciated at the start of the week but ended the day with modest losses against most rivals as equity markets turned around. European indices closed mixed, but Wall Street managed to post gains.
The EUR/USD pair ended the day around 1.0430, with limited upside potential amid ongoing tensions with Russia. Union ministers could not agree on a Russian oil import embargo, with Hungary, the Czech Republic and Slovakia the main opponents. In addition, the European Commission revised down its projections for economic growth amid the war in Ukraine, while they now see inflation rising at a faster pace this year and remaining above the European Central Bank’s target until 2023. .
GBP/USD is changing hands around 1.2310. Brexit-related headlines are back in the spotlight after UK Prime Minister Boris Johnson’s spokesman said they want to make significant changes to the Northern Ireland protocol, though he clarified they believe it is possible. within the framework of the protocol.
In addition, Bank of England Governor Andrew Bailey testified before the House of Commons Treasury Committee. He said he is not at all happy about the inflation outlook and that it is a bad situation, but added that more than 80% of the UK’s excess inflation is due to energy and tradable goods. Saunders, a member of the BOE, pointed out that Brexit could worsen UK inflation.
AUD/USD is trading around 0.6960, helped by gold as the latter trades above $1,820 a troy ounce. The USD/CAD pair tumbled to 1.2646 as crude oil prices soared, with WTI now trading at $111.30 per barrel.
Safe haven currencies posted modest gains against the dollar.
This week the UK, EU and Canada will release inflation data.
Source: Fx Street
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