ALL EYES ON FED

The Federal Reserve is widely expected to raise the target range for the federal funds rate by 25 bps to 5.25%-5.5% in July 2023, raising borrowing costs to the highest level since January 2001 and resuming the tightening campaign. after a hiatus in June. Investors will be closely watching any clues about the Fed's future plans, particularly whether it has finished with rate hikes or still intends to raise borrowing costs further. In June, most officials expected the federal funds rate to stand at 5.6% by the end of the year, suggesting at least two more rate hikes. US headline inflation slowed sharply to 3% in June, well below 9.1% a year ago, but remained above the 2% target.

INDICES

The Dow finished 26 points higher on Tuesday, marking its longest winning streak in more than 6 years and the 12th straight session of earnings, as investors weighed in on the latest corporate results ahead of the Fed's decision tomorrow. Meanwhile, the Nasdaq gained 0.6% and led gains for the session with Microsoft, Alphabet's results are expected after the closing bell. The S&P 500 added 0.3%, despite most of its top 11 sectors falling, materials stocks gained, following rising metal prices. On the corporate front, GE jumped 6.2% after raising its full-year earnings forecast and 3M rose 5.3% after a profit surge and as the company raised its earnings forecast. On the contrary, General Motors lost 3.6% despite raising its profit guidance for the fiscal year and announcing a deeper cost cut. Spotify fell 14.3% after disappointing revenue and guidance.

COMMODITIES

SILVER

Silver dipped to the $24.7 per ounce mark after hitting a two-month high of $25.2 on July 24, pressured by a momentary rebound in the US dollar as a strong jobless claims report renewed. evidence of a tight labor market and added room for maneuver for the Federal Reserve. to remain falcon for an extended period. Still, strong industrial demand and signs of tight supply capped the downside and lifted silver to outperform gold since the start of the third quarter. Efforts to curb carbon emissions magnified the effect of evolving solar panel technologies necessitating higher driving needs, underpinning strong improvements in silver demand forecasts.

FOREIGN EXCHANGE

DOLLAR INDEX ????

The dollar index steadied above the 101 mark on Wednesday, holding on to recent gains as investors braced for a key policy decision from the Federal Reserve. The Fed is widely expected to raise interest rates by another 25 basis points, but questions remain about whether the central bank will halt its tightening campaign or raise rates beyond July. Meanwhile, the US economy continued to show resilience, with consumer confidence jumping to a two-year high in July amid a strong job market and lower US inflation. On the other hand , the European Central Bank is also due to raise borrowing costs by another quarter point on Thursday, while the Bank of Japan is expected to maintain its ultra-easy monetary policy on Friday. The dollar held sideways against the euro, sterling and the yen, while gaining sharply against antipodean currencies amid weaker-than-expected Australian inflation data.

Chilean Peso ????????

The dollar peso is in a fairly strong lateralization prior to the economic policy decision by the FED for today and where the average of 200 1hr chart periods is already above $807 pesos. The Fed is expected to raise the rate by 25 basis pts today, which would further strengthen the dollar index and generate dissonance with the market that remains strong on the upside.