Wednesday June 22, 2005 - 07:48:06 GMT
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CMC Markets - www.cmcmarkets.com
Markets set for volatile day ahead of BoE report and oil numbers.
June 22nd - Despite the fact that many in the market are poised to put cable under pressure today if the Bank of England’s MPC meeting minutes suggest we’ll see interest rates fall in the coming months, the Pound has repeatedly found support in early trade. Against the dollar, we’ve now seen the 1.8300 level tested twice and successfully broken on the topside, although this is proving difficult to sustain. Further shorting of the Pound can also be expected if there are any indications whatsoever that monetary policy is on course to soften before 2006. The other key announcement on the economic calendar today is the release of US oil inventory data. With crude prices hanging on to the $59 a barrel mark, any data pointing towards the fact that supplies are lacking may be sufficient to see speculators push past the key psychological price of $60 and this can be expected to weigh on the currencies of many net oil importing countries. Expect the Yen to come under pressure as manufacturing again assesses the impact of increased import costs and the greenback may also be subjected to a sell-off if consensus amongst traders is that high oil prices will serve to extend the trade deficit - overall there’s a good chance that many currency pairs will find today’s session a volatile one.
Tim Wilbraham and Enis Mehmet
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