MHMarkets：Fed’s open to rate hike in July, Yellen says dollar strength factor

Fundamentals:

The Fed released the minutes of its early June discount rate meeting on Tuesday. The boards of most of the 12 regional Fed banks supported a 50 basis point increase in the discount rate ahead of the June FOMC meeting and consumer price data in May that showed accelerating inflation. From June 2 to June 9, the boards of 11 of the 12 regional Fed banks voted in favor of raising the discount rate by 50 basis points, minutes of the meeting showed.

U.S. Treasury Secretary Janet Yellen said the spread between U.S. and Japanese interest rates had become “considerable”, a “systemic” factor that tends to strengthen the dollar. She believes that Japan, the United States and the Group of Seven countries should implement a market-determined exchange rate system, and only in “rare and exceptional circumstances” are there reasons to intervene in the foreign exchange market.

Technical：

Dow:The three major U.S. stock indexes accelerated their decline in late trading. The Dow closed down 0.62%, the Nasdaq fell 0.95%, and the S&P 500 fell 0.92%. The Dow finished higher and fell back at 31,000, focusing on the position near 31,900 above.

U.S. dollar: The U.S. dollar index fell after reaching a high of 108.57, fell below the 108 mark during the session, and finally closed down 0.065% at 108.17 points; the 10-year U.S. bond yield recovered most of the decline during the U.S. session and closed at 2.971 %. The U.S. dollar is cautious in chasing more at historical highs, and in the short term, it is concerned about a slight correction near 106.5.

Gold: Spot gold failed to challenge the $1,740 mark several times within the day, and finally closed down 0.43% at $1,726.26 per ounce. Gold is cautious in chasing the empty space, focusing on the short-term callback target of gold at 1740.

Crude oil: In terms of crude oil, the two crude oils plunged in the U.S. session and fell below the $100 mark, as concerns over the epidemic intensified concerns about a slowdown in the global economy. WTI crude oil fell nearly 8 US dollars from the intraday high, and finally closed down 7.61% at US$95.57 per barrel; Brent crude oil closed down 6.69% at US$99.13 per barrel. Focus on the crude oil band callback 102.5 position.

(The above analysis only represents the analyst's point of view, the foreign exchange market is risky, and investment should be cautious)