The inflation in the UK fell to 0.5% in May – the lowest in nearly four years, the Office for National Statistics said in a statement. The core CPI eased to 1.2%, versus 1.3%. "Global prices for crude oil fell sharply from the beginning of 2020 before recovering throughout May, albeit to levels well below the start of the year," the ONS noted. Meantime, during the European session, Euro CPI for May released at-0.1%, same as forecast.
Asian markets mixed on Wednesday, amid geopolitical tensions in Asia includes tensions between North and South Korea and also border tensions between Indian and Chinese army. Japan’s Nikkei average closed 0.56% lower to 22,455.76 after the country exports fall to the lowest levels.
Crude Oil prices fall on Wednesday after an increase in U.S. crude inventories after the International Energy Agency (IEA) raised its oil demand forecast for 2020. API data showed US crude inventories rose by 3.9 million barrels in the latest week and gasoline stocks increased by 4.3 million barrels.
US dollar surged against other major currencies on Tuesday after Better-than-expected US retail sales data. The GBP/USD fell to a session low of 1.2540 on Wednesday after the economic data showed the UK CPI fell in May to the lowest level since June 2016.
The yellow metal trading steady above $1700 on Wednesday supported by fresh coronavirus outbreak in China and North Korea reportedly blew up a liaison office close to its border with South Korea.
On the data front, Japan’s exports dropped 28.3% in May from a year earlier in their biggest decline since the 2008 global crisis and imports fell by 26.2% during the reported month. On Tuesday, US retail sales climbed 17.7% higher during May, beating economists’ expectations for a rise of 8%.
Moving ahead today, the important events to watch:
US Building permits – 12.30 GMT
Canada CPI and Core CPI– 12.30 GMT
US crude oil inventory report- 14.30 GMT
US Fed Chair Jerome Powell's testimony- 16.00 GMT
The number of people infected with the coronavirus around the world has surpassed 8 million, of which more than 436 thousand have died. In the US, the new coronavirus infections climbed to record highs in several states, including populous Texas and Florida. On Tuesday, India witnessed the highest single-day spike of 2,003 coronavirus fatalities, pushing the death toll to 11,903, while total cases rose to 3.54 lakh with 10,974 new infections.
AUD/USD: The pair edged lower after it gained above 0.6900 level during the European session.
The important levels to watch for today: Support- 0.6850 and 0.6800 Resistance- 0.6930 and 0.6970.
EUR/USD: The pair dropped to a session low of 1.1235 during European session after mixed Eurozone economic data.
The important levels to watch for today: Support- 1.1220 and 1.1180 Resistance- 1.1350 and 1.1390.
Quote of the day: The big money is not in the buying or selling, but in the waiting- Charlie Munger.