What you need to know on Thursday, May 14th:
US Federal Reserve’s Chief Powell stole the show on Wednesday. The American dollar was under pressure against most major rivals, but finished the day with gains, as Powell dismissed chances of taking Fed’s rate sub-zero. Among other things, he also mentioned significant downside risks to the economy related to the current pandemic-related crisis. Wall Street edged lower and closed in the red, while US Treasury yields also ended the day with losses.
The EUR/USD pair remained within familiar levels, finishing the day around 1.0810. The GBP/USD pair collapsed and settled just above the 1.2200 figure. Data coming from the UK was mixed, although the economy suffered a sharp contraction in Q1 as GDP in the three months to March resulted at -2.0%.
The Japanese yen strengthened, with USD/JPY bouncing modestly amid resurgent dollar’s demand, although the late advance was capped by the heavy tone of equities and yields.
Crude oil prices ended the day little changed, despite the OPEC reduced its forecast for 202 demand by 2.23 million barrels a day.
Gold prices recovered their positive stance, with spot gold closing the day at around $1,715 a troy ounce after Fed’s Powell warned about the risks to the economy related to the COVID-19 pandemic.
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