Daily Wrap Up – 20 July

The Australian dollar bounced higher again to opening levels after falling in early trading, following Australian labor market data, which came within the expectations adding 14,000 jobs in June and participation rate rose to a 17-month high of 65%. The reason of declining of AUD is the downward revision of the employment change index and unemployment rate. The AUDUSD is now approaching its daily high of 0.7988, which is also its highest level in more than two years.

As expected, the BOJ kept its policy unchanged, and the outlook showed that the BOJ raised its growth expectations and downgraded its inflation estimates. The Bank of Japan's comments came in addition to Kuroda at the press conference to show signs that the bank will not follow the path of central banks Tightening monetary policy anytime soon.

The pound did not pay for positive retail sales and fell sharply, with sterling hitting its lowest level since July 13 at 1.2931 against the US dollar. UK retail sales rose by 0.6% in June, after falling by 1.2% in May.

The ECB also has left its monetary stimulus program unchanged and has not even raised the idea of easing stimulus program at its meeting, suggesting that it may make the decision at the last possible moment, leaving room for further stimulus if necessary. The EURUSD is currently testing the resistance range at 1.1614 / 1.1714 and the 200 EMA, and exceeding these levels will open the way for the pair towards the 1.20 levels.

In the US, the labor market continued to provide positive data in its strong direction. Initial jobless claims registered a 9-week low of 233,000, but did not provide sufficient support for the US Dollar , as the dollar index to surpass the support level at 94.19 and stabilizing Below it, we would see prices heading towards the 93 levels.