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Friday, 07 May 2021 12:47 GMT

Forex Today: FOMC Steady and Optimistic


(MENAFN - Daily Forex)

  • The U.S. FOMC held its accommodative monetary policy and low interest rate firm, while dismissing higher inflation as 'transitory and painting an optimistic picture of anticipated U.S. economic growth, albeit higher inflation is expected. The FOMC ruled out moving towards tapering yet.

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  • The FOMC release did not produce any dramatic market moves, but it was broadly slightly positive for stocks and risk assets and somewhat negative for the U.S. dollar. S & P 500 Index futures are trading off-hours at record all-time highs well above 4200. Asian stock markets are closing mostly higher today.
  • In the Forex market, risky currencies such as the British pound and the Australian and Canadian dollars are strong, while the U.S. dollar is weak.
  • Commodities are broadly higher, with firm bullish momentum in WTI Crude Oil and copper futures again trading at new 10-year high prices.
  • Today will bring a release of U.S. Advance GDP data. This is important and will be closely watched by analysts.
  • Friday saw an all-time record high number of confirmed daily new coronavirus cases globally, due mainly to increasing rates of infection in India and Latin America. The situation is especially bad in India which is seeing explosive growth in infection and an exponential rise in case numbers to new highs, which is putting a severe strain on the Indian health care system due to a shortage of oxygen. Many analysts believe the death toll in India is significantly underestimated. There are fears of mutations arising in India which would be resistant to current vaccines.
  • Global coronavirus deaths increased last week for the sixth week running after falling for months, signifying a rebound in the pandemic in areas where vaccinations are relatively absent. Daily deaths are approaching the peak made last January.
  • Total confirmed new coronavirus cases worldwide stand at over 150.2 million with an average case fatality rate of 2.11%.
  • The fastest progression in terms of immunizing a population against the coronavirus in all but the smallest states has been in Israel, which has given at least one shot to 62% of its entire population followed by the U.A.E. at 51%. For most of the world, a vaccine remains distant. However the pace of vaccination has finally begun to significantly speed up in the European Union, which now has immunized 22% of its population.
  • The rate of new coronavirus infections appears to now be increasing most quickly in Afghanistan, Argentina, the Bahamas, Colombia, Costa Rica, Cuba, Egypt, Georgia, India, Indonesia, Iraq, Japan, Kazakhstan, South Korea, Laos, Latvia, Lithuania, Malaysia, Netherlands, Nepal, Oman, Paraguay, Saudi Arabia, Sri Lanka, Trinidad, Tunisia, and Uzbekistan.

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