The highly anticipated decision by the US central bank is sure to be today’s main event as investors wait to see if the FED will raise interest rates by the previously expected 50 basis points or if it will be even more. aggressively after recent US macro data appeared to be quite worrying. US futures are trading flat, highlighting that the uncertainty is not unique to European investors and although there have been a series of PMI reports in Europe, the majority were revisions and have not had a significant impact on the shares. Meanwhile, gold is trading around $1870 after retesting an important low at $1862 and managing to halt a downward move that has seen the price drop nearly 7% since hitting a low. high of $1998 in mid-April. Additionally, in addition to the FOMC decision, US investors will also be keeping an eye on the ongoing Wall Street earnings season with reports expected from Moderna, Ebay and Uber among several others. After some widespread uncertainty in the markets, there could be significant moves today across all asset classes, many of which are swinging at significant levels.
Oil Trades Higher After API Inventory Report Shows Bigger Than Expected Drop
Oil prices started the day higher after yesterday’s API inventory report showed a higher than expected drawdown and traders are awaiting today’s EIA report for confirmation. WTI is up more than 3% and is trading around $106 after breaking through previous resistance around $105, which it is currently still testing. Meanwhile, Brent is hovering around $108 after gaining more than 2.8% and as Chinese demand uncertainty continues to be a key talking point as lockdowns escalate across the country due to increase in covid cases.