The Fed Kept the Key Interest Rate. Demand for the US Dollar Is Still High

Yesterday, the US Federal Reserve left the interest rate unchanged at 1.75%. The Fed also said that inflation had almost reached a benchmark of 2%. The regulator noted the steady growth of the US economy and also said that it intended to at least double raise the interest rate this year. The US dollar index (#DX) closed in the positive zone (+0.37%) yesterday.

Yesterday, a number of economic reports was also published in the Eurozone and the UK. So, the index of business activity in the manufacturing sector of Germany counted to 53.8 instead of the forecasted value of 53.4. The unemployment rate remained at the same level of 8.5%, as experts expected. The index of business activity in the construction sector in the UK counted to 56.2, which is higher than the expected value of 56.0. Preliminary data indicated a slowdown in the growth of the Eurozone economy in the first quarter to 0.4%.

The "black gold" prices are moderately growing. At the moment, futures for the WTI crude oil are testing the $67.85 mark.

Market Indicators

Yesterday, the bearish sentiment prevailed in the US stock market: #SPY (-0.67%), #DIA (-0.69%), #QQQ (-0.59%).

At the moment, the 10-year US government bonds yield is at the level of 2.96-2.97%.

Important economic reports on 2018.05.03:

- The index of business activity in the services sector in the UK at 11:30 (GMT+3:00);
- Consumer price index in the Eurozone at 12:00 (GMT+3:00);
- The index of business activity in the non-manufacturing sector in the US from ISM at 17:00 (GMT+3:00).

by JustForex, 2018.05.03

We advise you to get acquainted with the daily forecasts for the major currency pairs.

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

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