Fed members are divided over whether a rate-hike is needed soon according to the July FOMC Minutes. Although the minutes still paves the way for December rate hike, it is interpreted as more dovish because the general view of members monetary accommodation should be delayed until the accumulating of more data to gauge the economic performance. After the minutes, the US Dollar Index slumped 60 pips, remarking the daily low at 94.45. Stock in Wall Street were inspired by the less hawkish statement. Although opened lower, DJIA edged higher 21.91points, S&P 500 closed up 4.01 points and Nasdaq traded higher 1.55 points. The likelihood of another rate-hike in September is priced 12% in Fed fund future market, compared to 24% before the minutes. The possibility of rate-hike within the year decreased from 58% to 47%.
AUD/USD at week lows 0.7620 before the FOMC minutes managed a small recovery to 0.7650 but traders are hesitant to buy aggressively before the critical July Jobs numbers released at 11:30 AEST forecast at 10k.
The Oil rally was a hope rally before, after the EIA report published this morning, it became the truth. EIA data shows the crude inventories declined 2.5 million barrels, gasoline inventories fell 2.7 million barrels, which all decreased more than expected. Following the report, WTI rallied to $47.50, consolidating the previous gain. The key resistance level of $47.00 mark has been broken through, there will be a further bullish outcome to push the price towards next potential resistance at $49.00 and finally $50.
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