Here are the top five things you need to know in financial markets on Wednesday, June 8:

1. Dollar hits 5-week lows on diminished rate hike bets

The dollar fell to five week lows against a basket of the other major currencies on Wednesday as markets continued to adjust to diminished expectations for a near term rate hike by the Federal Reserve (Fed).

Fed chair Janet Yellen said earlier this week that the central bank plans to raise interest rate hikes, but gave no indication on the timing in a step back from the wording of “in the coming months” she employed in a May 27 speech.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.13% at 93.72, the lowest level since May 5.

2. Oil rises to fresh 8-month high on bets for U.S. supply drop

Oil prices added to overnight gains in European trade on Wednesday, climbing to a fresh eight-month high amid speculation weekly supply data due later in the session will show U.S. crude inventories fell at a faster pace than expected last week.

The U.S. Energy Information Administration will release its weekly report on oil supplies at 14:30GMT, or 10:30AM ET, amid expectations for a drop of 2.8 million barrels.

After markets closed Tuesday, the American Petroleum Institute, an industry group, said that U.S. oil inventories fell by 3.6 million barrels in the week ended June 3, compared to expectations for a decline of 3.5 million barrels.

U.S. crude oil futures rose 0.89% to $50.81, at 9:58AM GMT, or 5:58AM ET, while Brent oil advanced 1.03% to $51.97.

3. World Bank slashes global growth forecast

After the close on Tuesday, the World Bank cut its global growth forecast to 2.4% in 2016, from the prior 2.9%, due to stubbornly low commodity prices, sluggish demand in advanced economies, weak trade and diminishing capital flows.

In the U.S., a steep decline in energy sector investment and weaker exports will also shave eight tenths of a percentage point from the World Bank’s 2016 forecast, bringing growth to 1.9%.

4. Chinese imports spark hope of stabilization

China’s exports fell more than expected in May as global demand remained stubbornly weak, but imports beat forecasts, adding to hopes that the world’s second largest economy may be stabilizing.

Exports declined 4.1% year-on-year, worse than the expected decline of 3.6%, but imports only slipped 0.4%, compared to forecasts for a 6.0% slump.

5. German bond yield hits record low as ECB embarks on corporate bond purchases

Germany’s 10-year bond yield hit a fresh record low on Wednesday, as demand for safe-haven assets mounted amid concerns over the health of the global economy and uncertainty ahead of this month’s referendum on the U.K.’s membership of the European Union.

German 10-year bonds fell to an all time low of 0.033% on Wednesday.

The record low came on the day that the European Central Bank (ECB) began its foray into the corporate bond market as part of its effort to stimulate the euro area economy.

The ECB will announce the list of holdings on July 18 and planned to then update it every Monday.

News Source: http://www.investing.com/