All eyes rest on the Federal Reserve this evening, with a statement being released at 7pm GMT.

Expect volatility to come during the press conference, as Jerome Powell will most certainly be pressured to answer questions regarding the future policy decisions and economic outlook.

Yesterday saw the CPI data out of the US, with a drop further than expected, which could be pointing at a pause from the Fed, with market expectations dropping to 5% from 25% for a rate hike.

As for today, we have seen the release of the PPI data sliding further than forecast to -0.3% from an expected -0.1%.

This has resulted in a sell off in US10Y, and the inverse correlation saw gold find a bid jumping $14 on the release.

We are expecting rates to remain unchanged in June, and with market positions suggesting they see policy remaining unchanged, any hike here could see a significant spike in USD. Some key areas to watch on the FOMC news: 

  • US10Y: 3.6%

  • DXY: 102 & 102.5

  • Gold: $1940 support with $1980 resistance



  • Dow Jones: 34,300

 

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