Dollar moves steadily ahead of Powell's testimony

Investors are focused on Federal Reserve Chairman Jerome Powell's semi-annual testimony

By Farah Mourad | 9 July 2024

Market open
  • USD/JPY trading around 161.00

  • Brent and WTI crude oil are experiencing slight pullbacks

  • Gold trading above the $2,350 support level

Japanese Yen

Over the next few days, the Bank of Japan (BOJ) will engage in in-person discussions with key Japanese government bond market participants. These meetings aim to establish a realistic pace for reducing bond purchases. The BOJ will unveil its reduction plan following its upcoming meeting scheduled for July 30-31.

Currently, the USD/JPY pair is trading around 161.00, maintaining an ascending channel pattern on the daily chart, indicating a bullish trend.

US Market and US dollar

In today's session, the spotlight may be on Federal Reserve Chairman Jerome Powell's semi-annual testimony. Investors often scrutinize the text of his prepared remarks, typically published on the Fed's website before his testimony, making it crucial to monitor incoming macroeconomic information.

The US dollar is strengthening against most major currencies as investors anticipate Powell's testimony before Congress to gauge the Fed's stance.

Today's calendar includes several key events:

  • 02:15 pm BST: Fed's Barr speech
  • 03:00 pm BST: Powell's testimony in Congress (with a potential early transcript on the Fed's website)
  • 06:30 pm BST: Fed's Bowman speech
  • 09:40 pm BST: API data on changes in US crude oil inventories

In the commodities market

both Brent and WTI crude oil are experiencing slight pullbacks. Conversely, precious metals are drawing increased attention, with gold, silver, and palladium showing gains.

Gold is attempting a modest rebound, trading above $2,350 a psychological support level. This uptick in gold prices may be attributed to the consolidation phase of the US Dollar and US Treasury bond yields.