The problems resulting from the conflict in Ukraine seem to be having an effect on the euro.
As the yield difference among Treasuries and Japanese Government bonds (JGBs) tightens, USD/JPY keeps falling to the downtrend previously seen in the middle of last month.
While Australian PPI came in higher than anticipated at 5.6% YoY to the end of Q2, the Aussie and Kiwi are also strong gainers in Asia on Friday.
As USD/CHF is aiming for a low of 3 successive months, GBP/USD is at a monthly high. The main indices on Wall Street ended their trading session with a 1% gain.
With the assumption that inflationary pressures may be receding as a result of the US GDP statistics being underwhelming, the market began to expect for a less hawkish Fed moving ahead. An example of how negative news can be interpreted positively.
In a press release, Janet Yellen, the US Treasury Secretary, stated that the administration’s main aim is to reduce inflation, which she described as being abnormally high.
Equities of Japan and Australia gained ground thanks to the good lead from North America, but Chinese and Hong Kong stock exchanges are suffering.
The market was exposed by the lack of stimulus announcements made at the end of the politburo meeting for the day. The Hang Seng Index (HSI) for Hong Kong is at a low for the second consecutive month.
Iron ore slipped slightly due to worries about the status of the Chinese economy, even though commodities have been largely moving up with the weakening Dollar. At the week’s end, gold and crude oil have held their current gains constant.
As Apple and Amazon released strong profits just after the close, US futures are indicating a strong start to trade.
Presidents of the United States Joe Biden and China Xi Jinping spoke on the phone for two hours on July 28, which was described as forthright and constructive. Escalating tensions over Taiwan is the backdrop to arrangements for a face-to-face encounter.
Following a flurry of GDP and CPI results for the Eurozone, data for Canada will be released. The US payroll statistics that will be released later on Friday will be widely monitored because the labor market there remains remarkably tight.