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Anticipation builds for key US trading session

Anticipation builds for key US trading session


Traders across Asia are gearing up for a potentially turbulent United States trading session due to commence at 8.30 am US Eastern time. This session includes the unveiling of key inflation data, the Federal Open Market Committee (FOMC) announcement, and a media briefing from Federal Reserve Chair Powell. These events are anticipated to cause fluctuations in the forex, commodities, and bond markets across Asia.

The focus for many will be the inflation data, as it could influence future Federal Reserve monetary policy decisions. The FOMC’s statement and Federal Reserve Chair Powell’s media briefing are also on the watchlist, as they could provide clues about potential shifts in interest rates or changes in economic outlook. Traders are expected to use this information to identify trading opportunities and manage risks.

Awaiting the release of this crucial data, Asian market players have been in a standstill. Once the details are released, a substantial increase in trading activity is expected. This clear link between data releases and market activity highlights the impact of crucial announcements on broader market dynamics.

Meanwhile, Japan’s Producer Price Index (PPI) has seen an unexpected nine-month rise, mostly due to a weak yen increasing importation costs for raw materials.

Preparing for significant US trading session

This has notably amplified prices for imported commodities, keeping inflation high. Analysts suggest that this might push Japanese corporations to pass these higher costs onto consumers.

Furthermore, increased prices might lead to a drop in consumption levels, potentially causing wider economic issues. Decisions by the Bank of Japan could be largely affected by these economic conditions, with possible reevaluations of monetary policies and strategies on the horizon.

In other news, China has announced its latest economic indicators. The Consumer Price Index (CPI) stands at 0.3%, and the Producer Price Index (PPI) improved from +2.5% in April to -1.4% in May. Despite the PPI being in deflation territory, this improvement managed to give the Australian dollar a temporary boost.

On an international note, Samsung revealed their latest mobile phone model which features innovative technology. Manchester United achieved a significant victory over Liverpool with a 2-1 final score, and the much-anticipated sequel to James Cameron’s “Avatar” is scheduled for a December 2022 release. The World Health Organization (WHO) has issued new guidelines for managing the COVID-19 pandemic.

Minor changes were recorded in the major foreign exchange currency pairs, such as the Euro to US Dollar (EUR/USD) pair, the Pound to US Dollar (GBP/USD) pair, the US Dollar to Japanese Yen (USD/JPY), the Australian Dollar to US Dollar (AUD/USD) and Canadian Dollar to US Dollar (CAD/USD) pairs. This reflects minimal movements in the foreign exchange market for the day.

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