Forex Today: Run to safety only beginning

What you need to take care of on Thursday, June 23:

Fears continued to back the dollar, which ended the day with gains against most of its major rivals. The focus remained on overheating inflation and potential recessions among major economies.

German Economy Minister Robert Habeck announced the country would move to stage two of its three-stage gas plan amid reduced Russian flows. Ever since the war began in Ukraine, fuel shortages have been Europe's main concern. This particular phase does not mean state intervention, scheduled for the next one.

The EU flash S&P Global PMIs for June painted a gloomy picture as EU economic activity hit a 16-month low, reflecting a stalling of demand growth. The manufacturing PMI contracted to 52, while the services index shank to 52.8 from 56.1 in May. Australian data beat expectations while UK figures were mixed, although not much different from May ones. Finally, the US manufacturing index slowed to 52.4 in June, an almost two-year low, while the Services PMI contracted to 51.6 from 53.4 in the previous month, a five-month low. The reports fueled recession-related concerns.

FOMC Chairman Jerome Powell testified before the House Financial Services Committee on Monetary Policy and the State of the Economy. Fed's head said that a big part of inflation wouldn't be affected by the central bank's tools, although another part will be. On a positive note, he added that growth this year should still be fairly strong, but his comments clearly reflect concerns about inflation and growth, as he repeated that it would be "very challenging" to ensure a smooth landing.  

 Wall Street spent the day in the red but managed to post modest gains on Thursday. US Treasury yields, on the other hand, edged lower amid demand for safety.

Major pairs remained within familiar levels. The EUR/USD pair trades around 1.0530, while GBP/USD stands at around 1.2260. The AUD/USD pair struggles around 0.6900 while USD/CAD nears 1.3000.  Safe-haven CHF and JPY posted modest advances against the dollar.

Gold finished the day near its weekly low, now trading at around $1,825 a troy ounce. Crude oil prices were stable, with WTI settling at $104.00 a barrel.