JASPER’S MARKET SQUAWK 29-06-2023

<h2>Dollar Higher As JP Talks More Tightening</h2>
<p>Four central bank heads met at the ECB’s forum in Sintra and kept to the script that dealing with inflation would require more tightening while still waiting for transmission of the hiking that has already happened. The dollar gained, while gold declined.</p>
<p><img decoding="async" loading="lazy" class="alignnone wp-image-23931 size-full" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37.png" alt="" width="1916" height="913" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37.png 1916w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37-300×143.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37-1024×488.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37-768×366.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-37-1536×732.png 1536w" sizes="(max-width: 1916px) 100vw, 1916px" /><em><strong> Chart: GBPUSD</strong></em></p>
<h2>Key Factors For Today</h2>
<ul>
<li>Dollar positive as Fed Chair talks about more tightening at Sintra Forum</li>
<li>ECB officials express cautiousness about ending the cycle soon at Sintra Forum</li>
<li>EIA reports surprise drawdown in crude stocks, boosting WTI prices towards $70/bbl</li>
<li>AUD/USD lost 1.34% after inflation print, opening up zone below 69 cents</li>
</ul>
<h2>Powell Talks More Hikes at Sintra Forum</h2>
<p>Speaking at the ECB Forum in Sintra, Fed Chair Jerome Powell said that policy has been relaxed for a while and might need to be more restrictive. Powell explained that while overall inflation has decreased this year, core inflation remains a concern and will not reach the bank’s target of 2% until 2025. The continuation of interest rate hikes boosted the dollar against its peers. Versus the Pound, the GBPUSD pair ended the session 0.91% lower to $1.2634, opening up not only $1.26 but also $1.2550 so long it remains under $1.2684.</p>
<h2>ECB Officials Thinking Beyond July</h2>
<p>Several ECB officials commented on monetary policy at the Sintra Forum too. The president of the Board, Christine Lagarde, said the bank was unlikely to call the end of the cycle soon. ECB Board Member Bostjan Vasle (Slovenia) said he needed convincing that a rate hike in September was not warranted, starting from the baseline, more hiking beyond July is required. And ECB Board Member Scicluna (Malta) warned that the bank must be mindful of the impact of rate hikes after July. EUR/USD dropped 0.43% to $1.0912 and traded under $1.09 at the time of writing on Thursday morning. Only some respite above $1.0960 could substantially shift chances to the bullish side.</p>
<h2>EIA Reports Surprise Drawdown, Boosting WTI</h2>
<p>US crude inventories dropped 9.6M compared to a drawdown of 1.0M expected, while gasoline inventories saw a modest build of 0.6M bbl compared to the flat expected. Refinery utilisation dropped to 92.2% from 93.1% in the prior week. US crude exports rose to 11.8M bbl from 10.6M bbl prior, as oil trade with Mexico reached a record high. After reaching a 2-week low at $67.10/bbl, WTI bounced towards the $70/bbl handle for an intraday gain of 1.72%, which remains a crucial level bulls must take over to extend to $71/bbl and beyond.</p>
<h2>Australian Retail Sales Higher, Job Vacancies Lower</h2>
<p>May Retail Sales in Australia rose 0.7% compared to 0.1% expected, the fastest growth this year. The turnover was seen supported by sales events. However, job vacancies in the first quarter fell 2.0% compared to the -1.5% prior and the fourth consecutive quarter. Job openings in May also fell. AUD/USD lost 1.34% on Wednesday due to lower inflation figures, tapping the territory beneath 69 cents but holding the line of defence during early Thursday. $0.6561 is lower support, while the next resistance above the daily peak of $0.6630 lies awaits by $0.6651.</p>
<h2>On The Docket</h2>
<ul>
<li>FED Chair Powell’s Speech</li>
<li>Spain’s Inflation Rate</li>
<li>BOE Consumer Credit</li>
<li>EA Economic Sentiment</li>
<li>German Inflation Rate</li>
<li>Initial Jobless Claims</li>
<li>US GDP Growth Rate (final)</li>
<li>Pending Home Sales</li>
<li>BOE Tenreyro Speech</li>
<li>FED Bostic Speech</li>
<li>Japan’s Unemployment Rate</li>
<li>European Council Meeting</li>
</ul>
<h2>FX 1-Day Relative Performance (USD)</h2>
<ul>
<li>Aussie and Kiwi 0.14% and 0.05% up</li>
<li>Euro and Pound are down by 0.25% and 0.15%</li>
<li>Yen is 0.05% lower, whereas Franc at -0.18%</li>
<li>Canadian dollar is lower by 0.14%</li>
<li>Gold is down by 0.55%, while silver is 0.38% higher</li>
<li>WTI is down by 0.52%, whereas Brent is by -0.62%</li>
<li>Natural gas is a mere 0.07% lower</li>
</ul>
<p>The post <a rel="nofollow" href="https://www.keytomarkets.com/blog/analysis/jaspers-market-squawk-29-06-2023-23927/">JASPER’S MARKET SQUAWK 29-06-2023</a> appeared first on <a rel="nofollow" href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>