CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Daily summary: Hawkish FOMC not enough to offset dovish CPI

20:11 12 June 2024
  • FOMC left interest rates unchanged in the 5.25-5.50% range, in-line with market expectations. Statement repeated that central bank needs to have greater confidence in inflation return to target before cutting rates
  • New 'dot-plot' showed median expectation of just a single rate cut for this year, down from three cuts in March projections. However, there was an almost equal split between members who saw 1 and 2 cuts in 2024
  • However, Fed Chair Powell tried to send a very balanced message during the press conference, stressing that projections are not a plan
  • Money markets see an around-70% chance of Fed cutting rates, little changed compared to pre-FOMC pricing
  • Wall Street indices dropped slightly after FOMC decision but held onto post-CPI gains and remain near all-time highs. S&P 500 trades 1% higher, Nasdaq rallied 1.8%, while small-cap Russell 2000 surges 2.2%. Dow Jones trades flat
  • Apple continue upward move launched after developers event and surges 6%, extending two-day rally to over 13%
  • USD recovered part of post-CPI declines after FOMC decision. However, EURUSD still trades 0.7% higher on the day
  • Gold and silver dropped after FOMC decision but also hold above pre-CPI levels. Gold gains 0.2%, while silver trades over 1% higher
  • US CPI inflation decelerated from 3.4% in April to 3.3% YoY in May (exp. 3.4% YoY), while core CPI inflation decelerated from 3.6% to 3.4% YoY (exp. 3.5% YoY). Release trigger a strong dovish market reaction, with USD dropping and indices gaining
  • European stock market indices traded higher today, support by dovish US data release - German DAX gained 1.5%, French CAC40 moved 1% higher, Dutch AEXx jumped 1.1% and UK FTSE added 0.8%
  • Oil erased daily gains and turned negative after bearish DOE report. Report showed a 3.73 million barrel increase in oil inventories (exp. -1.7 mb), a 2.57 million barrel increase in gasoline inventories (exp. 0.2 mb) and a 0.88 mb increase in distillate stockpiles (exp. 0.5 mb)
  • UK GDP growth decelerated from 0.7% YoY in March to 0.7% YoY in April (exp. 0.6% YoY). On a monthly basis, UK economy stagnated (0.0% MoM vs 0.0% MoM expected)
  • UK industrial production declined 0.4% YoY in April (exp. +0.3 YoY), while manufacturing production was 0.4% YoY higher (exp. 1.6% YoY)
  • Final German CPI reading for May came in-line with flash release and showed headline CPI accelerating from 2.4% in April to 2.8% YoY in May
  • Chinese CPI inflation remained unchanged at 0.3% YoY in May (exp. 0.4% YoY), while PPI inflation accelerated from -2.5% to -1.4% YoY (exp. -1.5% YoY)

This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.

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