June 22, 2022
EUR/USD: The euro is weakening against the U.S. dollar. In the absence of significant economic releases, the comments of European financial officials remain the focus of investors’ attention. Thus, the day before Deutsche Bank head Christian Sewing said that the EU and the U.S. face a high probability of recession, as central banks are forced to aggressively tighten monetary policy to fight inflation. Also note the comments of Philip Lane, chief economist at the European Central Bank (ECB), who spoke of the danger of an “inflationary psychology” forming in the eurozone, with consumers increasing spending in an effort to buy goods before the price rises, and businesses raising selling prices in anticipation that demand will continue to rise. The combination of these factors only increases inflationary pressures, and combating them by raising rates is a necessity.
SELL 1.0502/TP 1.0447/SL 1.0516
AUD/USD: The Australian dollar is weakening against the U.S. dollar today. Investors await the release of minutes from the latest Reserve Bank of Australia (RBA) meeting, in which the rate was raised to 0.85%. Despite the expected increase by 25 or 50 basis points, a tougher course of action was chosen, which is likely to be maintained in the near term to counter rising prices. Note that the head of the RBA Philip Lowe said that at the peak of inflation in the country could reach 7%, and expressed confidence that its decline will help to tighten monetary policy and increase interest rates around the world, creating a balance between supply and demand for goods.
SELL 0.6915/TP 0.6860/SL 0.6929
Brent: Oil quotes continue to decline today. In general, the situation in the market is uncertain, as fears of recession in the U.S. due to a sharp increase in rates by the U.S. regulator are offset by an increase in the seasonal summer demand for fuel and the re-start of enterprises in China after downtime caused by the outbreak of pandemic coronavirus. According to experts, the situation remains positive for price growth, since the supply of “black gold” cannot yet compensate for the demand, including due to the restrictions imposed by the U.S. and European countries on oil supplies from Russia.
BUY 111.30/TP 115.70/SL 110.10