Weekly Comment – USD rampages after Fed, Bank of England coming up

The USD stormed higher this week after the Fed signalled that the days of cheap money are coming to an end. That triggered a massive unwind of the entire 'inflation trade', with gold getting hammered alongside every other commodity. The coming week will bring a barrage of economic data along with a Bank of England meeting.

Highlights ahead:

· The main event will be the BoE decision on Thursday. Not much is expected, but there is a possibility the Bank upgrades its language on inflation and growth. This could be seen as an indication the UK is moving towards higher rates and perhaps boost the GBP a little.

· Before that, preliminary PMI data from the Eurozone will hit the markets on Wednesday. They'll be crucial in shaping the path for EUR, which has taken a beating from the resurgent USD lately.

· There's also a ton of economic data coming up from America, Canada, and Australia.

· In commodity markets, gold has been demolished by the stronger USD and fading inflation fears. Meanwhile, oil prices will keep an eye on the outcome of Iran's election.

· Last but not least, stock markets have defied the Fed's hawkish signals and remain elevated near record highs, with tech and growth stocks spearheading the latest rally.

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