Markets rebound ahead of ECB decision - 8.9.2022

The Dollar strengthening has resumed currently. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, slid 0.7% Wednesday as Fed’s beige book survey showed prospects for the US economy are flagging as high prices force Americans to focus more of their spending on staples, with demand set to weaken further.

Both GBP/USD and EUR/USD reversed their sliding on Wednesday as Destatis reported German industrial output slowed less than feared in July. Euro and Pound are lower against the Dollar currently. USD/JPY slowed its climbing yesterday while AUD/USD reversed its sliding with both the Australian dollar lower against the Greenback currently and yen higher.

The US stock index futures are down currently ahead of speech by Federal Reserve Chairman Jerome Powell today at 15:10 CET. The three main US stock indexes booked gains ranging from 1.4% to 2.1% Wednesday while Fed vice-chair Lael Brainard warned that the US central bank will stay the course on its aggressive fight against high inflation "for as long as it takes" to bring prices down.

European stock indexes futures are rebounding currently after closing down yesterday led by oil and gas shares. The European Central Bank is meeting today and is widely expected to raise rates by 75 basis points at 14:15 CET to fight inflation. Asian stock indexes futures are advancing mostly today with Hong Kong’s Hang Seng Index leading losses after the release of worse than expected Chinese trade data on Wednesday.

Brent is edging higher currently. Prices fell yesterday after the American Petroleum Institute report US crude inventory unexpectedly rose last week. At the same time Chinese customs data showed China’s crude oil imports in August fell 9.4% from a year earlier. The US oil benchmark West Texas Intermediate (WTI) futures dropped 5.7% but is higher currently. Brent crude lost 5.2% to $88 a barrel on Wednesday.