Global macro overview for 26/08/2015:
The People's Bank of China (PBOC) hast cut the main interest rate for the fifth time since November 2014 overnigh and the equity sell-off might be stopped at least for now. The market participants must now wait and see if this government directed easing policies will make any difference for the world's second largest economy. On the other hand, the Fed funds are pricing a 21% chance of a Fed rate hike in September, which is down 29% from 50% chance before last Thursday's FOMC meeting minutes release. The Chinese stock market turmoil and overall troubles are postponing the rate hike in the US to at least December 2015.
After a five-day decline, the US Dollar Index has found a needed support and closed above the level of 93.13 yesterday. Currently, the golden trendline is being tested from the downside and only a sustained breakout back above the 95.00 level would put bulls back into the game.
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