There was a massive sell off in the Equity market yesterday as global equities dropped by more than 1% across the board. This could be attributed to the weak oil price couple with interest rate hike later this month. USD was also weak after a strong rally last week to make a new high for the year. Every other currency rallied against the USD especially GBP and EURO.
Royal Bank of Australia last night cut interest rates by 25bp to 2.50% but maintains the fact that the bank might still cut interest rate if economic condition deteriorates. He however maintained that inflation is likely to hit range midpoint by the end of 2017.
In South Africa, the President sacked the finance minister of the country; this triggered a massive sell off on South Africa Rand. USDZAR Rallied to an all-time high with 3 Minutes to trade at 15.21.
Commodity prices continue to sell off. Oil prices still trading around the $37 -$36 area despite the reduction in oil inventory which was shown in the data released last night. The crude inventory indicates that stockpile has reduced by more than 3 Million barrels. The fall in oil price has given USDCAD a boost which currently trade comfortable above the 61.8% Fibonacci level of 1.34. Price is likely to retrace back to test the 88.6% Fibonacci level at 1.530 levels.
Later today, the Bank of England will be releasing their monetary policy decision. Market is expecting BoE to leave interest rate unchanged. The Bank Governor is expected to sepal thereafter. Also, the Swiss National Bank is also expected to release her monetary policy statement which is expected to leave interest rate unchanged as well.