The US reported lower-than-expected US inflation numbers for July. The consumer price index report showed that US inflation fell to 8.5%, and the CPI had soared to 9.1 percent on year in June, the highest in 40 years. Meanwhile, the core CPI remained steady at 5.9%, lower than the forecast of 6.1%. The slowdown last month has driven largely by falling fuel prices
“Today we received the news that our economy had zero percent inflation in the month of July. Zero percent.” US president Joe Biden said. “The economic plan is working, and second is building an economy that will reward work,” – he added.
US futures holding the previous session gains supported by the decline in the US consumer prices during last month and positive comments from US president Joe Biden. However, the strong upside momentum paused after the Fed officials commented that further interest rate hikes will follow.
Crude oil prices rebounded and ended higher on Wednesday despite the release of weak EIA inventory data. The bullish sentiment was lifted by the uncertainties regarding Iran’s exports and the closure of the southern Oil pipeline from Russia to eastern Europe. The EIA data showed that US crude stockpiles expanded by 5.5 million barrels last week.
In the currency market, the US dollar index plunged to a fresh monthly low following the release of the most waited US CPI report. Moving ahead to the North American session, the USD traders should closely monitor the release of the U.S. producer price index and weekly jobless claims data.
The safe haven rebounded back to above $1800 on Wednesday supported by the weaker US dollar. However, the overall momentum remains mixed for the long-term as the improvement in the risk appetite of the investors is shifting the focus from safe-haven assets.
Moving ahead today, the important events to watch:
US – PPI: GMT – 12.30
US – Jobless claims: GMT – 12.30
Worldwide, more than 584 million people have been confirmed infected and more than 6.4 million have died. The United States has confirmed over 92 million cases and has had more than 1.03 million deaths from COVID-19, the highest total in the world.
Technical Outlook and Review
EURUSD: In the short-term perceptive, the immediate bias will remain bullish as long as prices are held above 1.0280. On the flip side, any break below 1.0280 then the next support near the 1.0240/30 levels.
The important levels to watch for today: Support- 1.0300 and 1.0280 Resistance- 1.0350 and 1.0370.
GOLD: The precious metal needs a clear break of the previous session high of $1806 to move further upside $1820. On the flip side, a breakdown through $1780 would negate that bias and suggest a test of the $1772/65 support region.
The important levels to watch for today: Support- 1780 and 1772 Resistance- 1795 and 1806.
Quote of the day - The single most important advice I can give is, to learn from your mistakes. That is the only way to become a successful trader- David Ryan.