Fed Expectations Rise on Thursday

2024-06-06

Summary:

On Thursday, the dollar weakened as markets bet on a Fed easing cycle this year. Nearly 50 bps rate cuts are anticipated, starting in September.

EBC Forex Snapshot, 6 Jun 2024

The dollar eased on renewed bets of a Fed easing cycle expected this year on Thursday. Markets have priced in nearly 50 bps rate cuts this year, with the first expected to come in September.

Data showed the US services sector switched back into growth mode in May after a short-lived contraction the month before, though details of the survey pointed to employment remaining in contraction territory.

USDJPY

The yen edged down as the Bank of Japan turned more hawkish. Governor Kazuo Ueda said it would be appropriate to reduce the central bank's bond buying as it moves toward exiting its massive monetary stimulus.

Citibank vs. HSBC Currency Pair Data Comparison
	Citi (as of 3 Jun)		HSBC (as of 6 Jun)
	support	resistance	support	resistance
EUR/USD	1.0788	1.0895	1.0798	1.0927
GBP/USD	1.2300	1.2803	1.2679	1.2854
USD/CHF	0.8988	0.9158	0.8824	0.9101
AUD/USD	0.6563	0.6729	0.6587	0.6708
USD/CAD	1.3577	1.3846	1.3609	1.3759
USD/JPY	152.12	158.44	154.50	157.73

The green numbers in the table indicate that the data has increased compared with the previous time; the red numbers indicate that the data has decreased compared with the previous time; and the black numbers indicate that the data has remained unchanged.

Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

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