Powell's comments weakens greenback

Daily Analysis - 27/02/2019

USD near 3-week lows


On Wednesday the popular greenback weakened and dropped near to a 21-day low while dovish feelings once again were confirmed by the Federal Reserve Chairman Jerome Powell.

The dollar index versus a basket of six important currencies held at 96.112 after dropping 0.4% in the last trading session to 95.947, the lowest since the beginning of the month.

On Tuesday Chairman Jerome Powell stated that increasing dangers and recent weak numbers were unpromising and probably not going to support a stable increase for the U.S. economy for 2019. However, the Fed would continue to be “patient" on additional interest rate hikes.

Gold steady for now

On Wednesday, Gold remained steady while the greenback held near a 21-day low following the Federal Reserve's chairman repeated statement that the U.S. central bank is going to continue to stay patient on additional interest rate hikes.

The U.S. gold futures rose 0.2% at $1,331.19 while Spot gold was flat at $1,328.89 per ounce.


Asian stocks going up

On Wednesday Asia Stocks advanced before the anticipated meeting between North Korean leader Kim Jong Un and President Donald Trump in Vietnam. Hong Kong's Hang Seng index climbed more than 0.4%.

The mainland Chinese markets gained while the Shanghai Composite gained around 0.8% The Shenzhen composite achieved little more than 0.37%. Japan's Nikkei 225 climbed more than 0.4% in the afternoon.


Oil Rises

Oil surged on Wednesday following a report of falling crude inventories in the country. OPEC appeared to hold to its stock cuts notwithstanding the demand from U.S. President Donald Trump. Ole Hansen, a commodity strategist said: "Crude oil has been rising lately, not due to strong growth and rising demand but primarily due to a politically orchestrated cut in production from OPEC and friends.”

International Brent crude futures went up to $65.50 per barrel while the U.S. West Texas Intermediate (WTI) crude oil futures also went up to $56.02 per barrel.


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