The market is ready for the Federal Reserve to raise interest rates by 75 bps following their Federal Open Market Committee (FOMC) session on July 27.
Markets may be rocked by instability if the policy is changed by less than 75 bps. If they succeed in doing that, markets will pay close attention to Jerome Powell’s remarks as the Chair of the Federal Reserve.
His prior remarks have shown that he thinks the effects of a recession are not the main worry, but instead the inability to control inflation. The current state of Treasury yields is unaffected.
The Euro is still being affected by the Russian energy supply to Germany, and the northern winter has increased concerns about natural gas supplies ahead.
Crude oil prices remained stable at about US$ 95 per barrel for WTI and US$ 104.40 per barrel for Brent despite the pressure on the energy markets.
The American Petroleum Institute (API) announced that the previous week saw a 4 million barrel decrease in oil stocks. Later this afternoon, markets will be looking for confirmation in the Energy Information Administration statistics.
With a modest shortfall of 6.1% year-on-year (YoY), the Australian headline CPI recently announced has been viewed as permitting the RBA to hold off on significant increases. The Australian Dollar exchange rates and local bond yields decreased.
The Hang Seng Index (HSI) in Hong Kong fell alongside Wall Street, although other APAC equity markets saw virtually no movement. US futures are indicating that the cash session will begin well.
Due to the rising dollar, the gold price is currently fluctuating at US$1,715/oz.
In terms of price, WTI crude is getting close to where it was before the Ukraine crisis. The 55- and 100-day simple moving averages (SMA) have turned bearish, indicating that momentum has turned bearish as well.
Both the preceding lows of 90.56 and 90.06 as well as the breakpoint of 92.93 may provide support. At the latest highs of 100.99 and 105.24, resistance may be found on the upper side.
