The Federal Reserve cut rates by 25 basis points, as did the Bank of Canada, in line with expectations. Markets did not react positively, as the Fed warned they may not cut again this year, as expected. The Bank of Japan and the ECB both held rates steady, as they have come to the end of their monetary cycle and are experiencing a revival in inflation. Trump came to a short term, one year agreement with China, while the South Korea also reached a trade agreement. The reaction to the Feds commentary sent the Dollar surging, as the EUR tumbled to 1.1550, while the GBP slumped to 1.3120.The surging reserve hit the recently recovering commodity currencies hard, with the AUD falling to 0.6550, while the NZD plunged under 0.5750. Market focus will now turn to reemerging inflation with reading from the US (in the form of the PCE indicator), Europe and Japan.
