23.03.202111:45 Forex Analysis & Reviews: Uncertainty period in the markets is not yet done

The situation in the market continues to be extremely uncertain and volatile. As previously mentioned, there are several conflicting factors responsible for this behavior, which, on the one hand, support the demand for risky assets and put pressure on the dollar, while on the other, act the other way around.

Assessing the current situation, investors are waiting for certainty to come, but for now, we will most likely expect the concerning upward and downward movements in the market.

Today, the market will be paying attention to the speech of Fed Chairman J. Powell and some of his colleagues. However, we are unlikely to hear something new in his comments, as he already talked about the important things after the results of the Fed's monetary policy meeting in March, where the regulator revised upward all macro indicators in the US for the coming years. At the same time, Powell himself assured the markets that the regulator will leave the monetary rate unchanged until 2023 and will allow the country's economy to "overheat" for the sake of its recovery and economic growth.

In terms of the currency market, there is a lack of coordinated movements in pairs where the dollar is present. If commodity currencies are under pressure from the correction in commodity and commodity asset prices, which is caused by growing fears that the stimulated inflation growth in the US associated with the sharp growth in treasury yields will lead to a slowdown in business and production activity that will reduce demand for commodity and commodity assets, then the euro, pound, yen and franc move in pairs with the dollar without much consistency.

A noticeable example of this uncertainty is the dynamics of gold prices, which has been in a quite narrow range since last Wednesday. It has no systemic price growth, leading to its decline.

Based on the above-mentioned, the focus will be on the speeches of Powell, Fed members Bostic, Barkin, Brainard and Williams. Investors are also waiting for the comments of the Governor of the Bank of England Bailey and the Governor of the Central Bank of Canada Gravelle. In addition, there will be a publication of important economic data in the US, particularly the new home sales and the Richmond Fed Manufacturing Index.

Forecast of the day:

The EUR/USD pair continues to consolidate in a narrow range of 1.1870-1.1990, which narrows even more to the range of 1.1870-1.1950. Today, this pair is expected to stay within this range.

The GBP/USD pair is also consolidating in the range of 1.3800-1.4000. We believe that it will also remain in this range either until the of the week or until the US inflation data is released.