Posted at 28 August 2023 / Categories Market Roundups
Market Roundup
•EU Jul M3 Money Supply (YoY) -0.4%, 0.0%forecast,0.6% previous
•EU Jul Loans to Non Financial Corporations 2.2%, 2.5% forecast, 3.0% previous
•EU Private Sector Loans (YoY) 1.3%, 1.4% forecast,1.7% previous
•EU Irish Retail Sales (MoM) -0.8%, 0.4% previous
•EU Jul Irish Retail Sales (YoY) 5.9%. 7.6% previous
Looking Ahead Economic Data (GMT)
•French 12-Month BTF Auction 3.639% previous
•French 3-Month BTF Auction 3.684% previous
•French 6-Month BTF Auction 3.658% previous
•14:30 US Aug Dallas Fed Mfg Business Index -21.6 forecast, -20.0 previous
•15:30 US 3-Month Bill Auction forecast, 5.300% previous
•15:30 US 6-Month Bill Auction 5.295% previous
•17:00 US 2-Year Note Auction 4.823% previous
•17:00 US 5-Year Note Auction 4.170% previous
Looking Ahead Events And Other Releases(GMT)
•No events Ahead
Currency Forecast
EUR/USD: The euro edged higher on Monday as investors awaited data from the bloc and the U.S. later this week after central bankers in Jackson Hole did not provide additional cues about the direction of monetary policy. Remarks from ECB policymakers remain in focus, with Vice President Luis de Guindos and Isabel Schnabel a prominent policy hawk and the head of the ECB’s market operation - due to speak later this week, along with more Fed officials. Germany and Spain will release inflation data on Wednesday. France, Italy and the euro area’s aggregate numbers are due on Thursday. The euro, which has fallen 1.7% so far in August, rose 0.14% to $1.0809, but the single currency stood near an almost 11-week low hit on Friday after European Central Bank President Christine Lagarde emphasised that policy needed to be restrictive. Immediate resistance can be seen at 1.0823(5DMA), an upside break can trigger rise towards 1.0841(38.2%fib).On the downside, immediate support is seen at 1.0762(23.6%fib), a break below could take the pair towards 1.0751(Lower BB).
GBP/USD: The British pound held near recent lows low on Monday as investors were cautious ahead of readings on U.S. jobs and inflation that could decide whether interest rates have to rise again.Much will depend on the flow of U.S. data, including this week's ISM survey on manufacturing, along with reports on payrolls, core inflation and consumer spending.Median forecasts are for payrolls to rise 170,000 in August with a steady jobless rate of 3.5%.Figures on European Union inflation this week may also be instrumental in whether the European Central Bank (ECB) decides to hike next month.Immediate resistance can be seen at 1.2628(38.2%fib), an upside break can trigger rise towards 1.2643(5DMA).On the downside, immediate support is seen at 1.2566 (Lower BB), a break below could take the pair towards 1.2548(23.6%fib).
USD/CHF: The dollar eased against the Swiss franc on Monday as Federal Reserve Chair Jerome Powell's hawkish commentary doused expectations that the U.S. rate-hiking cycle was nearing an end, with investors awaiting economic data this week for confirmation on rate trajectory. Powell, in a speech at an economic summit in Jackson Hole, Wyoming, said policymakers would “proceed carefully as we decide whether to tighten further,” but also made clear the central bank has not yet concluded that its benchmark interest rate is high enough to be sure inflation returns to the 2% target. The dollar slipped from its multi-week high to $104.09 against a basket of currencies. Immediate resistance can be seen at 0.8867 (Higher BB), an upside break can trigger rise towards 0.8881(23.6%fib).On the downside, immediate support is seen at 0.8820 (38.2%fib), a break below could take the pair towards 0.8797(14DMA).
USD/JPY: The dollar strengthened on Monday as markets remained cautious ahead of European and U.S. economic data expected later in the week due to determine central bankers' next steps. Powell promised on Friday to move with care at upcoming meetings as he noted both progress made on easing price pressures as well as risks from the surprising strength of the U.S. economy. Markets anticipate an 80% chance of the Fed standing pat next month, the CME FedWatch tool showed, but the probability of a 25 basis point hike in November is now at 51% versus 33% a week earlier.A series of strong U.S. economic data releases has helped ease worries of a recession but with inflation still above the Fed's target, some investors are worried that the U.S. central bank will keep interest rates at elevated levels for longer Strong resistance can be seen at 146.78(23.6%fib) an upside break can trigger rise towards 147.48(Higher BB).On the downside, immediate support is seen 145.82(5DMA), a break below could take the pair towards 144.81(38.2%fib).
Equities Recap
European shares advanced on Monday, with technology stocks leading gains following an upbeat close on Wall Street and a rise in China-exposed industrials after Beijing announced measures to aid its ailing stock market.
At (GMT 12:10 ),UK's benchmark FTSE 100 was last trading up at 0.07 percent, Germany's Dax was up by 0.71 percent, France’s CAC was up by 0.95 percent.
Commodities Recap
Gold held its ground on Monday as investors digested hawkish comments from Federal Reserve Chair Jerome Powell before a slew of U.S. economic data this week that is expected to shed light on inflation and the labour market.
Spot gold was steady at $1,913.99 per ounce by 1000 GMT. U.S. gold futures gained 0.1% to $1,941.10.
Oil was little changed on Monday after China took steps to bolster its flagging economy, though investors remained worried about the pace of growth as well as further U.S. interest rate hikes that could dampen demand.
Brent crude slipped 15 cents, or 0.2%, to $84.33 a barrel by 1045 GMT, with an earlier rally fizzling out just short of the $85 mark. U.S. West Texas Intermediate crude gained 5 cents to $79.88.