June 6, 2023: Recent Developments and Market Highlights

The Australian dollar jumped after the interest rate hike, while the US dollar declined.

The Australian dollar soared to its highest levels since mid-May on Tuesday, June 6th, after the Reserve Bank of Australia raised interest rates by 25 basis points to 4.1%, defying expectations of keeping them at 3.85%.

Meanwhile, the US dollar continued its decline from the highest level in two and a half months that it reached last week against major currencies. This followed unexpectedly weak data for the US services sector released yesterday evening, which bolstered expectations that the Federal Reserve would not raise interest rates in its meeting next week. However, this overshadows monetary policy expectations in the coming months.

In the latest trading, the Australian dollar recorded a 0.73% increase to $0.6665 after jumping to $0.6677, its highest level since May 16th.

The US dollar index, which measures the performance of the US currency against six major currencies, declined by 0.11% to 103.89 after several days of volatility. It had reached its highest level in two and a half months at 104.70 in the last days of May but then declined following hints from US Federal Reserve officials that they may not raise interest rates in June.

The dollar fell by 0.05% to 139.49 yen, the euro rose by 0.11% to $1.0722, and the British pound increased by 0.12% to $1.2450.

US Securities and Exchange Commission sues Binance and its CEO.

The US Securities and Exchange Commission (SEC) has brought 13 charges against the digital currency trading company Binance and its CEO, Changpeng Zhao.

The allegations claim that the largest digital currency trading company mixed billions of dollars of user funds and sent them to a European company under Zhao’s control.

In March of last year, the US Commodity Futures Trading Commission filed a complaint against Binance and its former chief compliance officer, Samuel Lim, regarding allegations of violating trading rules.

The lawsuit alleges that Binance and its CEO worked to undermine their controls to allow wealthy investors and clients to continue trading on the platform.

The complaint alleges that the defendants displayed blatant disregard for federal law. Binance and Zhao violated vital provisions of federal securities laws, including self-dealing and market manipulation, through Merit Peak Limited, owned by Zhao.

Gary Gensler, Chairman of the SEC, said: Through these 13 charges, we allege that Zhao and Binance engaged in a wide range of deception, conflicts of interest, and disclosure failures.

The complaint also noted that the company generated $11.6 billion in revenue, mostly from transaction fees, from June 2018 to July 2021.

It further stated: Since its inception, the platform operated openly and covertly to lure customers in the United States under Zhao’s direction and control.

Zhao responded to the list of charges, saying: We will issue a response once we have reviewed the complaint. The media gets the information before we do.

As a result, Bitcoin recorded its largest daily loss in about three months, dropping 6% during yesterday’s session. Bitcoin attempted to stabilize around $25,700 after a 6% decline in the evening, marking its most significant drop since April 19th.

Digital currency traders suffered losses of $320 million from liquidation operations in a single day.

Oil prices fall despite OPEC meeting.

Oil prices declined on Tuesday, June 6, relinquishing most of the gains made in the previous session after Saudi Arabia, the world’s largest oil exporter, announced its intention to increase production cuts.

Brent futures dropped 23 cents or 0.3% to $76.48 per barrel. US crude lost 25 cents or 0.4% to reach $71.90 per barrel.

Brent had risen by as much as $2.6 on Monday, while US crude surged by $3.3 after a few hours of Saudi Arabia’s announcement that it plans to cut its production by one million to 9 million barrels per day in July.

This voluntary cut, the largest by Saudi Arabia in years, comes in addition to a broader agreement by the OPEC+ alliance, which includes the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia, to limit supply to support oil prices.

The OPEC+ alliance accounts for about 40% of global crude oil production.

However, many of these announced production cuts following the OPEC meeting in Vienna on Sunday might have little impact, as the group lowered the targeted production levels for Russia, Nigeria, and Angola to align with their current actual production levels.

Apple stock lost strength, while Tesla stock jumped to its highest level in 7 months.

Apple shares closed down by 0.75% after falling from its all-time high during the session that witnessed the company’s announcement of its latest products at its annual Worldwide Developers Conference.

Apple unveiled its mixed reality glasses, Vision Pro, as its first significant new product since 2014, in addition to a 15-inch MacBook Air.

Tesla stock rose by 1.7% in Monday’s session, marking its highest closing 7 months after rising for the seventh consecutive session.

This momentum came after the company announced an increase in sales of its electric cars manufactured in China in May.

Disclaimer: This article is not investment advice or an investment recommendation and should not be considered as such. The information above is not an invitation to trade and it does not guarantee or predict future performance. The investor is solely responsible for the risk of their decisions. The analysis and commentary presented do not include any consideration of your personal investment objectives, financial circumstances, or needs.

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