The two days FOMC meeting that began Tuesday, and concludes with a statement and a press conference due later today. The Fed is widely expected to leave interest rates unchanged. The investors and traders will closely watch the updates from the U.S. Federal Reserve for clues on how long the interest rates could remain at the present low levels. The central bank scheduled to issue its policy statement at 18.00 GMT.
Major US stock indices closed slightly lower on Tuesday after a significant drop in US Consumer Confidence and declines in health care and tech stocks. The US Consumer confidence tumbled to the lowest level in six years during April as a result of the shutdowns across the US. Asian stocks rose on Wednesday after Asian countries like Australia, New Zealand actively looking at resuming some economic activity as the rise in the number of coronavirus cases slows down.
Oil prices rose after US stockpiles rose less than expected and hopes grew for demand to pick up as some European countries and US cities moved to ease coronavirus lockdowns. According to the API report, crude inventories in the US increased by 10 million barrels over the previous week to total 510 million barrels, slightly lesser than the 10.6 million barrel build forecast by economists.
The Australian and New Zealand Dollars extended their gains are both countries began opening their economies successfully overcome Covid-19. The Canadian dollar continues to trade strong against the US dollar after strengthening by 0.4% in the previous session, boosted by gains in crude oil prices.
Gold prices-price rebounded from a one-week low on Tuesday US session after the dollar fell to the lowest level in two weeks.
New Zealand’s April Trade Balance released in early Asian session saw its Surplus ease to +NZD 672 million from March’s downwardly revised +NZD 531 million and missing forecasts of +NZD 700 million.
Australia printed its highest quarterly inflation in five years. Consumer prices in Australia rose 2.2% in the first quarter of 2020 as wildfires and early effects of coronavirus outbreak led to a significant jump in food prices.
On the earnings front, Pepsi Co (NASDAQ: PEP) Q1 revenue increased by 7.9% to $13.9bn and EPS grew 10%, to $1.07. The beverage company saw an increase in demand during the social distancing measures.
Important economic events today:
US quarterly GDP numbers – 12:30 GMT
US Pending Home Sales – 14:00 GMT
EIA U.S. Crude Oil Inventories – 14.30 GMT
USD: FOMC Rate Decision – 18:00 GMT
FED Chairman Jerome Powell press conference – 18.30 GMT
Coronavirus Update: Spain’s daily death toll has risen again Wednesday with the health ministry reporting 325 deaths Wednesday, up from 301 reported the day before. Singapore on Wednesday preliminarily confirmed 690 new cases of the coronavirus, the country’s health ministry said. That takes the total number of infected people in the country to 15,641. The French and Spanish governments announced plans Tuesday to allow restaurants and other businesses to reopen gradually. They followed Italy, which announced similar plans on Sunday.
GOLD: The gold price slightly unchanged on Wednesday ahead of US GDP and FED decision.
The important levels to watch for today: Support- $1695 and $1680 Resistance- $1720 and $1738.
EUR/USD: The pair holding positive momentum against the dollar on Wednesday ahead of ECB meeting on Thursday.
The important levels to watch for today: Support- 1.0830 and 1.0780 Resistance- 1.0890 and 1.0930.
GBP/USD: The pair trading slightly weaker against the dollar and euro on Wednesday.
The important levels to watch for today: Support- 1.2410 and 1.2380 Resistance- 1.2520 and 1.2565.
Quote of the day: The single most important advice I can give is, learn from your mistakes. That is the only way to become a successful trader- David Ryan.