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Sterling hits three-month high vs euro, falls against dollar

 

 

“The only thing that overcomes hard luck is hard work.” — Harry Golden 

 

 

HEADLINES

 

 

  • Sterling hits three-month high vs euro, falls against dollar
  • Gold accelerates on gloomy U.S. economic readings
  • Oil mixed as US gasoline demand rebounds but recessionary fears loom
  • Wall St gains on hopes of smaller rate hikes as economy shrinks again
  • Bitcoin jumps above $23,000 as it attempts another rally following Fed rate hike
  • GBPUSD Near Term: Downside favored

 

 

Sterling hits three-month high vs euro, falls against dollar

 

 

Sterling rallied to a new three-month high versus the euro as traders dumped the single currency on concerns about an escalating energy crisis in the euro area.

With the conclusion of the Conservative Party leadership contest that will decide the next British prime minister not due until September and investors waiting for the Bank of England monetary policy meeting next Thursday, analysts say there have been few domestic drivers for sterling in recent weeks.

Instead, the British currency has benefited from a pullback in the dollar and a euro still struggling under the weight of worries about shortages of natural gas from Russia and a weakening economy.

 

 

COMMODITIES

 

 

Gold accelerates on gloomy U.S. economic readings

 

 

Gold rose over 1% on Thursday as a contraction in the U.S. economy boosted its safe-haven allure and helped to extend gains driven by a less aggressive tone from the Federal Reserve chairman.

The U.S. economy unexpectedly contracted in the second quarter, with consumer spending growing at its slowest pace in two years and business spending declining, which could fan market fears that the economy was already in recession.

Spot gold extended gains on the data, and was last up 1.1% to $1,752.94 per ounce by 10:50 a.m. EDT (1450 GMT), helped along by a subsequent slide in U.S. Treasury yields.

U.S. gold futures rose 1.8% to $1,749.10.

 

 

ENERGY

 

 

Oil mixed as US gasoline demand rebounds but recessionary fears loom

 

 

Oil prices were mixed on Thursday, as concerns about a potential global recession that would knock energy demand offset lower crude inventories and a rebound in U.S. gasoline consumption.

Brent crude futures rose 28 cents to $106.90 a barrel by 1:17 p.m. EDT (1716 GMT), after gaining $2.22 on Wednesday.

U.S. West Texas Intermediate crude (WTI) fell 58 cents to $96.68 a barrel, after rising $2.28 in the previous session.

 

 

STOCKS

 

 

Wall St gains on hopes of smaller rate hikes as economy shrinks again

 

 

Wall Street's major indexes reversed course to gain in early afternoon trading on Thursday, as a contraction in the U.S. economy for the second straight quarter raised expectations of a less aggressive monetary policy by the Federal Reserve.

Gross domestic product fell at a 0.9% annualized rate in the last quarter, the Commerce Department said in its advance GDP estimate. A Reuters survey had showed that the growth likely rebounded at a 0.5% annualized rate.

Two consecutive quarters of declines in growth are traditionally considered a recession, but the private research group which is the official arbiter of U.S. recessions looks at a broad range of indicators including jobs and spending.

 

 

Bitcoin jumps above $23,000 as it attempts another rally following Fed rate hike

 

 

Bitcoin rose above $23,000, following stocks higher after the U.S. Federal Reserve raised interest rates but suggested the pace of hikes could slow.

Cryptocurrencies have been quite correlated to U.S. stocks, in particular the Nasdaq, which on Wednesday jumped 4%.

Bitcoin traded at $23,838.00 at around 2:00 p.m. ET on Thursday, up about 4.67%, according to data from CoinMetrics.

Other digital coins rose, too. Ether was about 8.82% higher at $1,728.23, CoinMetrics found.

 

 

ANALYSIS

 

 

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CHART

 

 

GBPUSD Near Term: Downside favored

 

 

Technical View: Short position below 1.2165. Target 1.208. Conversely, break above 1.2165, to open 1.22.

Comments: The pair remains under pressure. Further weakness favored.

Source: Trading Central 

 

CALENDAR

 

 

*Times in GMT

Source: FX Street Economic Calendar


Footnotes
https://www.reuters.com/markets/us/sterling-flirts-with-three-month-high-vs-euro-2022-07-28/
https://www.reuters.com/markets/europe/gold-holds-firm-less-hawkish-fed-buoys-appeal-2022-07-28/
https://www.reuters.com/business/energy/oil-prices-edge-up-low-inventories-high-gasoline-demand-us-2022-07-28/
https://www.reuters.com/markets/europe/futures-fall-meta-qualcomm-forecasts-ahead-gdp-data-2022-07-28/
https://www.cnbc.com/2022/07/28/bitcoin-jumps-above-23000-after-federal-reserve-interest-rate-hike.html
 

 

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