EURUSD is looking unstable. Overview for 08.06.2022

EURUSD is falling on Wednesday morning but keeps on trying to consolidate.

The major currency pair is declining despite the market’s attempts to reach stability. The current quote for the instrument is 1.0692.

The key trigger that supports the “greenback” is the rally in US bond yield growth. Also, investors are very cautious about possible risks considering the upcoming US Fed meeting and rather mixed statistics. 

Janet Yellen, the United States secretary of the treasury, told the media yesterday that the country’s economy was facing a lot of new difficulties due to several different problems, from interruptions in deliveries to unacceptable inflation boost. She believes that the government should establish a relevant budget position to help the Fed to be more effective in taking control over the consumer price index. 

Yellen also noted that the US Department of the Treasury was currently focused on reforming the tax system, corporate taxes in particular. In her opinion, the American economy is in transition from recovery to stable growth. 

In this light, Rabobank’s statements about the recession are looking rather unusual. The bank believes that even if the US economy avoids recession in 2023, it will be inevitable in 2023. Catalysts for recession might be responses to external shocks or the economy’s reactions to high and stable inflation. 

The inflation issue and what the Fed is going to do about it remains very topical and has a great influence on currency exchange rates.