Foreign exchange European trading: MT4.MT5 US dollar trading trend grasp

Investing.com - The U.S. dollar edged higher in European markets on Thursday (21st), while the euro also edged higher, although investors were cautious ahead of the European Central Bank's meeting on interest rates later in the day, but Russia Resumption of natural gas supplies to Western Europe boosted risk sentiment.

 

U.S. dollar index futures, which measure the greenback's strength against six trade-weighted major currencies, were up 0.06% at 107.14 as of 16:30 GMT (04:30 a.m. ET).

 

EUR/USD was up 0.12% at 1.0189, not far from its intraday high of 1.0273 since July 6 touched on Wednesday (20th).

 

Earlier in the day, Russia announced the end of a 10-day maintenance period for the Nord Stream 1 pipeline and restarted gas deliveries to Europe through the pipeline.

 

Although a spokesman for the operator of the Nord Stream No. 1 pipeline said it would take some time for traffic to return to the required level, Russia's lack of political reasons for extending the outage still eased concerns about the energy crisis on the European continent.

 

However, market sentiment remained somewhat cautious ahead of the ECB's monetary policy meeting. At present, the market is widely expected that the European Central Bank will raise interest rates for the first time since 2011 at this meeting.

 

European Central Bank President Christine Lagarde has said she will raise rates by 25 basis points at this meeting, but news earlier this week said the bank will discuss raising rates by half a percentage point to stem soaring inflation, even if there is a Risk of recession. Inflation in the euro zone hit an annualized rate of 8.6% in June, data released earlier this week showed.

 

In addition, the ECB is likely to provide more information on a tool to stem the sharp rise in bond yield spreads among euro zone member countries, especially needed to reduce Italy's debt risk as the Italian government collapses.

 

Italian Prime Minister Mario Draghi announced his resignation again today, after Draghi won a confidence vote in the Senate on Wednesday, but three key parties in the coalition government refused to participate in the vote, marking the division of the coalition government.

 

Italy's 10-year bond yield rose to 3.693%, with the spread to Germany's 10-year bond yield (1.2915%) widening sharply.

 

"We don't think these details (about the ECB's tool to curb widening spreads) will convince the market," said analysts at Nordea. "Even if the market were persuaded, the ECB is unlikely to use the full firepower of the tool unless absolutely necessary. ."

 

Elsewhere, dollar/yen was up 0.26% at 138.57 after hitting a 24-year high of 139.38 last week. Earlier, the Bank of Japan maintained its ultra-loose monetary policy despite raising its inflation forecast and warning of risks to the economic outlook.

 

GBP/USD was down 0.23% at 1.1941, even though the field of candidates for Britain's next prime minister has narrowed to two. AUD/USD, which is highly risk-sensitive, was down 0.23% at 0.6870.

 

Elsewhere, the dollar was up 0.34% against the Turkish lira at 17.6639. The central bank of Turkey will also announce its interest rate decision today, and is expected to keep interest rates unchanged at 14% despite soaring inflation and the global stream of tightening monetary policy.