Market News

The big question hanging in the air this week is whether or not the Fed will officially schedule a date for the interest rate increase which it has been predicting for the last few months.

The Euro had been gathering steam and had earlier struck a 2-week peak versus the US Dollar as traders awaited the release on German business sentiment. Germany, as the largest economy in the Euro area, essentially drives the remainder of the Eurozone and largely sets sentiment for the common currency.

Financial markets usually slow down in the summer. But the coming week could provide some indication of how the rest of the quarter will pan out. The Federal Reserve's monetary policy decision will take center stage and along with the U.S. second-quarter growth report investors should have a better idea of what the rest of 2015 will look like.

There is very little data scheduled this week with the exception of the U.S. and Australian Dollars. Regarding the USD, this week will see the key monthly event in the Forex news calendar: the FOMC statement.

For those who doubted that renewed talks with Greece would move along smoothly, it came as no surprise that the first sang was hit on Friday.

There seems to be no end to how low crude oil can go. The precious metal fell another 1.5 percent on Thursday, settling at $48.48, the lowest level since March 31. Many analysts are expecting it to drop even more in the months ahead.

The Euro had edged above the $1.10 level on Thursday, as FX traders still consider abandoning ship on the US Dollar. In the past month, the US Dollar had surged nearly 5% against the Euro, but this week its positive momentum has faded, with analysts expressing some wariness that the year-long rally might be finally reaching the end of its course.

All that glitters is not gold these days as the precious metal hit its tenth straight day of losses Wednesday. Gold has had a steady decline over the last few weeks and has fallen to a new 5-year low of $1100 after a round of roller coaster rides that took it as high as $1160 an ounce and erasing half of the gains from a 12-year bull rally that ran from 1999 to a record high close of $2000 in September 2011.

Profit taking cut into the US Dollar’s recent gains, driving it to its largest drop this month. The fall came despite widespread expectations that the Federal Reserve is possibly on the brink of a rate hike.

While interest rates in the U.S. are predicted to go up any day now, rates in Australia could be moving in the opposite direction. After cutting the benchmark interest rate twice this year to a record-low of 2 percent, Reserve Bank of Australia (RBA) Governor Glenn Stevens said that additional cuts may be in the forecast.

Investors’ speculation is growing once again, with expectations high that the United States Federal Reserve Bank is moving closer to hiking interest rates. James Bullard, the president of the St. Louis branch of the Fed, said yesterday that the Fed might even consider a September rate increase.

In what seems like a strange turn of events, the Greek government found the money to repay the roughly 2 billion euros ($2.2 billion) it owed to the International Monetary (IMF).

Among the world’s major currencies, the New Zealand Dollar, or Kiwi as it’s called among traders, was the primary mover. That came after New Zealand’s Prime Minister said that he was concerned about the scope of the Kiwi Dollar’s recent decline.

It hasn’t been too difficult to bet on the price of gold of late with prices dropping steadily over the last few years. But Monday’s plunge took the metal lower than even the analysts had anticipated.

It looks as if this week will be quieter than recent weeks, which much less on the agenda and with a lot of industry participants beginning to leave on summer holidays. It would not be surprising if the market begins some kind of lull now as we go into August.