Today, the US dollar index is trying to rise ahead of the publication of FOMC Minutes - 25.5.2022

On Tuesday, the US dollar index fell for the 2nd day in a row. Thus, its correction continues for the 2nd week. Yesterday's decline in the index was facilitated by the strengthening of other currencies due to plans to tighten monetary policy not only by the Fed, but also by almost all other world central banks. In particular, this morning the Reserve Bank of New Zealand raised the rate to 2% from 1.5%. This caused the appreciation of the New Zealand dollar. Yesterday, the euro rose noticeably after European Central Bank (ECB) President Christine Lagarde announced that she does not rule out a stronger increase in the ECB rate - immediately to 0.5% at a meeting on July 21. By this time, the European asset buyback program should be completed. Note that at the next ECB meeting on June 9, the rate is likely to remain at the current level of 0%. This morning the US dollar index is trying to rise. Investors are waiting for the publication of the Federal Open Market Committee (FOMC) Minutes (materials of the Fed meeting). They should confirm the Fed's determination to raise the rate (1%) in the future. According to CME FedWatch, there is an 89.8% chance of a Fed rate hike at the next meeting on June 15. In addition, data on orders for durable goods (United States Durable Goods Orders) for April will also be released tonight. Their forecast is negative, but it does not affect the mood of market participants now.

Bitcoin continues to trade in a narrow range of $28,500-31,500 near the psychological level of $30,000 for the 3rd week in a row. The main positive factor may be the continued legalization of the crypto market in the United States. The United States Federal Reserve Board included data on cryptocurrencies in its Economic Well-Being of U.S. Households. Among the negative factors, one can note the continued outflow of funds from cryptocurrency funds. According to CoinShare, as of May 20, $141 million was withdrawn from them in a week. In addition, Bank of England governor Andrew Bailey criticized the cryptocurrency market.

There was no single trend on the US stock market yesterday. The Dow Jones rose while other indices declined. Shares of Snap (which owns the mobile service Snapchat) plunged 43% after reporting a slowdown in the company and negative revenue forecasts. This contributed to the decline in quotes for Pinterest (-23.6%), as well as social networks Meta Platforms (-7.6%) and Twitter (-5.6%). An additional negative was the weak data on the residential real estate market. Sales of new buildings (New Home Sales) in April fell to a 2-year low and amounted to 591 thousand This morning, futures for US stock indices rose. Investors are positive about the outlook for the stock market after the 1st quarter. S&P 500 listed companies will see a 9.3% increase in total earnings for the full year of 2022, according to Refinitiv. This is a little more than the forecast for the beginning of the publication of quarterly reports in April (+8.8%). Note that after the correction of quotes, the current ratio (Р/Е) capitalization/net profit for the year (price-to-earnings) for the S&P 500 index decreased to 16.6. In December 2021, it was less attractive for investment and amounted to 22.1. The long-term average P/E for the S&P 500 is 16.

Oil rose slightly on Tuesday. U.S. West Texas Intermediate (WTI) has been trading around $110 per barrel for the 4th day. Investors are trying to evaluate the offer of U.S. President Joe Biden to limit the export of petroleum products from the country in the event of a domestic shortage. The American Petroleum Institute reported an increase in US oil inventories for the week by 0.57 million barrels. However, this did not have a negative effect on quotes, as investors expect the end of the coronavirus lockdown in Shanghai (China) from June 1. Saudi Foreign Minister Prince Faisal bin Farhan said the global oil supply is now relatively balanced.

Grain futures quotes are correcting down due to the forecast of the Russian Grain Union on grain exports from Russia in the agricultural season 2021/2022 in the amount of more than 40 million tons. This is much more than the USDA forecast for Russia. It should be noted that the Ministry of Agriculture of the Russian Federation expects that grain exports in the current season will be even greater and will amount to 45-48 million tons.