The state of play.

Today's GDP report was 'contrasting'. Lower than forecast actual GDP induces a 'bad news is good news scenario', meaning, slowing growth suggests rate cuts on the horizon. But, a higher inflation metric within the numbers suggests holding rates for longer. the initial reaction was a potential for the first US cut pushed out until November. And the USD strengthend accordingly in a 'risk off' environment. That strength has now reversed as the market appears to be pondering it's next move.

I currently maintain my view of trading 'hawkish' central banks Vs 'dovish' central banks. For what it's worth, here is my current 'table' with the most hawkish at the top...

AUD

NZD

USD

GBP

CAD

EUR

JPY

CHF

With imminent Microsoft earnings, BOJ interest rate decision and US core PCE, my current decision is to wait for the dust to settle on all of the above before forming a conviction in the direction of the currencies.

All questions or thoughts welcome: johnelfedforexblog@gmail.com