Optimism is back in the markets as we see that global stock markets are rallying since investors are leaning more towards higher yielding assets versus lower yielding assets, on increasing signs that the economy will not fall into a double dip recession.
Also the IMF raises its global growth forecasts this year to 4.6% from the prior estimates in April of 4.2%, and this further boosted risk appetite. Currently we see the Dollar Index, which gauges strength of the dollar against six major currencies, is currently declining trading at 83.90 while recording a high of 84.01 and a low of 83.70.
The European Central Bank (ECB) today is going to announce interest rates in which expectations show that they will be once again left steady at 1.00% as the euro zone continues to suffer from high indebted nations, which is choking that outlook of the euro zone and holding back the central bank from raising interest rates anytime soon. The euro dollar pair is currently trading at 1.2653 between the support of 1.2610 and the resistance of 1.2700 while posting a high of 1.2687 and a low of 1.2618. The daily charts are showing us that the pair is being traded in an overbought area.
Also the BoE like the ECB is going to announce interest rates in which projections in markets that they will remain unchanged at 0.50% as the APF will once again continue to be paused, in worries that resuming the program will trigger inflation in the long run. Today, Martin Weale joined the MPC of the BoE, yet will not be involved in today's rate decision. The pound dollar pair is currently trading at 1.5156 above the support of 1.5080 and the resistance of 1.5230 while posting a high of 1.5240 and a low of 1.5141.
Turning to the dollar yen pair, we see that they are inclining as investors are more interested in higher yielding assets, which therefore weighs on the strength of the yen in markets since it is a lower yielding asset. The pair is currently trading at 88.09 between the support of 87.55 and the resistance of 88.95 while recording a high of 88.46 and a low of 87.64.