US inflation data for May showed another acceleration and now investors are eager to hear whether Fed's narrative has changed. US central bank will announce policy decision on Wednesday. Meeting will also include a new set of macroeconomic forecasts. Apart from that, EU-US summit and oil market will be in the spotlight next week.
US100
Start investing today or test a free demo
Open account Try demo Download mobile app Download mobile appUS CPI inflation accelerated to 5% YoY in May while core gauge jumped 3.8% YoY. The question is what's next? The Fed has played down rising prices for some time and stressed that inflation is transitory. Will this narrative be repeated during the upcoming policy announcement on Wednesday, 7:00 pm BST? Rates are expected to be left unchanged but a new set of macro forecasts may offer some surprises. Meanwhile, markets do not seem to believe that the US central bank will begin tightening with US100 reaching 14,000 pts area this week.
EURUSD
While the US dollar is likely to be impacted by the Fed's policy announcement, the greenback may also get a chance to move on Tuesday, when the US and EU hold a summit. The meeting may be used to reset the trans-Atlantic relationship after it was strained during Trump's term as the US President. EURUSD pulled back this week but continues to trade just 1% below recent post-pandemic highs in the 1.2270 area.
OIL
Oil prices reached fresh post-pandemic peaks this week with WTI jumping above $70 and Brent strengthening past $72 per barrel. One risk to the outlook for oil prices is potential return of the Iranian production. The United States wants to reach a nuclear agreement ahead of presidential elections in Iran, scheduled for Friday, June 18. Apart from that, oil may experience elevated volatility during regular stockpiles data releases - API report on Tuesday and DOE report on Wednesday.
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.
