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Market Recap – Ramadan ends, USD crashes

Tuesday, June 4, 2019 10:58 AM GMT

Having tested the 98.16$ high on Thursday, USD index is in a free fall for 3 consecutive sessions. As this post is produced the index is testing the low daily Bollinger band.

The Ramadan, the holy month of Muslims ends.

The central bank of Australia (RBA) cut interest rates to 1.25% as it has been expected for the last two monetary meetings. Markets had a “sell the fact” reaction and AUD is trading higher.

Following the EU parliament elections, when the League gathered 34% of the votes and the 5 Star Movement dropped to the third place gathering 17% of the votes, the current, the Italian case is back in the headlines. Prime Minister Conte is determined to resign unless the two parties stop bickering. A crucial meeting will take place tomorrow in Brussels that could potentially lead to a €3.5bn fine against Italy.

Macro releases: The global manufacturing activity as expressed by the yesterday’s PMI releases is shrinking. European PMI continues recording a 47.7 reading, (below the 50 threshold that indicates contraction), the Japanese PMI at 49.8, the German PMI at 44.3, the UK PMI at 49.4, the US PMI at 50.5 and the Canadian PMI at 49.1.

Today, the European inflation is expected to confirm that the ECB, that is meeting on Thursday, is far away from its 2% target.

 

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