US Retail Sales in Focus

With the Turkish Lira resuming its recent declines, a wave of risk-aversion across the financial markets was triggered, and therefore Dollar regain power against its major rivals. EUR/USD pair hit a thirteen-month lows at 1.1320, GBP/USD broke the 1.2700 major level before bouncing back, and USD/JPY is continuing its bullish push higher peaking for Wednesday at 111.42.

The EU docket remains data-empty, therefore the US July retail sales to be released at 12:30 GMT, will move the EUR/USD pair. A better-than-expected print would only add to the bearish pressure around the EUR. On the other hand, a weak reading could help the oversold EUR regain some poise. The EUR pairs could also turn volatile during Bundesbank President Jens Weidmann’s speech, scheduled at 16:00 GMT.

USD/JPY pushing for 111.50 ahead of US retail sales, and on the JPY data front will be seeing Japan’s latest Trade Balance figures late in the day at 23:50 GMT, where an expected surge in imports is expected to push the Merchandise Trade Balance down from the last showing of ¥720.0 billion to ¥-50.0 billion.

UK’s unemployment rate fell to 4.0% yesterday, a forty-three year low for the indicator, though the rest of the UK’s job report was notably less cheery, with the number of people not working and not looking for work increasing by more than expected, while earnings also missed market expectations. Today at 08:30 GMT will see the UK’s latest CPI reading, and markets are expecting a slight improvement to 2.5% for the year into June, versus the previous reading came in at 2.4%.

Oil prices fell on Wednesday, pulled down after the API inventory data showed an unexpected crude build last week. Official U.S. fuel inventory data is due to be published later today by the Energy Information Administration.

Gold prices pull back as demand for Dollar goes up amidst the Turkish lira contagion crisis. Gold is currently trading below $1,190, with no sign of reversing, as the U.S. Dollar firms. With interest rates are expected to go higher later this year, Dollar appears to be a safe buy option, as a result, market sentiments are bearish on gold.