June 21, 2021 – Gold, Dow, Pound-Dollar, BoE Rate Decision, Fed Risk, PMIs, and more. Markets were roiled by a wave of volatility last week largely in response to the Fed bringing forward its interest rate hike projections.
These two developments helped fuel a massive influx of US Dollar strength across the board of major currency pairs. USD/JPY and USD/CAD surged while EUR/USD, GBP/USD, and AUD/USD snapped sharply lower.
Metals and Cryptocurrencies
Precious metals plunged sharply due to the increased threat of an expedited Fed taper timeline with gold price action tumbling -5.88% to trade back in the red year-to-date. BTC/USD price action has fallen -15.55% while ETH/USD has declined -17.34%.
the S&P 500 Index notched its worst week of losses since 22 February after falling -1.91% on balance.
The Dow Jones faced similar selling pressure and lagged with an -3.45% decline. The Nasdaq was able to finish in positive territory on the week with a gain of 0.37%.
What to expect this week
The release of monthly PMI data is scheduled for release. Markets are also scheduled to receive another reading on US inflation.
The Fed’s preferred gauge of inflation, core PCE, is due to cross wires on Friday, 25 June at 12:30 GMT. These high-impact data releases stand to weigh on broader market sentiment due to their potential to further sway the threat of Fed tapering.
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