EUR is out for the count. Overview for 30.06.2022

EURUSD plunged in the last 24 hours – the asset remains under pressure.

The major currency pair is moving hesitantly on Thursday. The current quote for the instrument is 1.0439.

The US GDP Q1 report published yesterday showed -1.6% y/y, which is worse than the expected reading of -1.5% y/y. The components of the report showed that the PCE parameters were revised downwards, but this decline was a bit eliminated by the fixed investment growth that remained robust.

If all the talks about recession didn’t have any grounds before, then now these grounds appeared.

In his speech delivered yesterday, US Fed Chairman Jerome Powell said that the country’s economy was strong enough to withstand the monetary policy tightening. He believes that the labour market is quite strong, and households are feeling fine. The same can be told about businesses.

This was another confirmation for investors that the regulator is planning to be aggressive in its monetary policy. It may well be that during its July meeting the Fed will raise the rate by 75 basis points instead of a 50-point rate hike announced earlier.