Crude Oil price struggles to find an upside direction as the oversupply concerns increase after data from both the EIA and API showed a surprise build in US crude inventories last week. According to the EIA Petroleum Status Report, US crude oil stocks rose by 5.654 million barrels in the week ended July 3rd, 2020 and the API report also shows a build of 2 million barrels in crude oil inventories. The Oil investors and trader’s attention now turns towards the OPEC and its allies (OPEC+) meeting scheduled on July 15 for fresh updates on the oil output cuts policy.
The dollar rose to its highest level in more than three years on Thursday after the liquidity injection operations undertaken by central banks around the world. The greenback is helped by continuing weakness in the Pound, Euro, Cad and other Asian currencies.
The DXY currently trading at 102.20 if the bullish momentum continues the next target will be Jan - 2017 high. January 2017 was the last time we saw the U.S. dollar have this kind of strength.
As per the recent update, the Italian death toll has now overtaken China. In New York, coronavirus cases rose to 4,152 from 2,383, while in the UK, coronavirus cases jumped to 3268 vs. 2689 yesterday. So According to Gulf brokers, if the death toll rate continues to pick up at a steady rate, the markets will be still in risk mode and equities may continue to drop then the U.S. dollar will gain further. But a stronger dollar can be bad news for U.S. exporters, making their goods more expensive in foreign markets.
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The British pound trading strong against the Dollar and Euro after the new £30 billion fiscal stimulus plan. On Wednesday UK Chancellor Rishi Sunak's announced fresh stimulus measures to support jobs and activity in the UK disappointed investors. Other measures included a stamp duty holiday, a £3 billion green investment package and a temporary cut to VAT on tourism and hospitality.
Gold price climbed above $1,800 an ounce during the European session, the first time since 2011. The overall momentum remained bullish throughout this week as investors turned to safe-haven assets amid a spike in coronavirus cases in several countries across the globe.
The Reserve Bank of Australia (RBA) left official interest rates at the historical low of 0.25% on its monthly meeting on Tuesday. RBA governor Philip Lowe said, "Uncertainty about the health situation and the future strength of the economy is making many households and businesses cautious, and this is affecting consumption and investment plans,"