Posted at 25 September 2023 / Categories Market Roundups
Market Roundup
•Finnish Aug Export Price Index (YoY) -9.9%, -12.3% previous
• Spanish PPI (YoY) -10.0%, -8.4% previous
•German Sep Business Expectations 82.9, 82.9 forecast, 82.6 previous
•German Sep Ifo Business Climate Index 85.7,85.2 forecast, 85.7 previous
•German Sep German Current Assessment 88.7,88.0 forecast,89.0 previous
•UK Sep CBI Distributive Trades Survey -14, -33 forecast, -44 previous
Looking Ahead Economic Data(GMT)
•13: 00 French 12-Month BTF Auction3.773% previous
•13: 00 French 3-Months BTF Auction 3.830% previous
•13: 00 French 6-Months BTF Auction 3.828% previous
•13: 00 Belgium Sep NBB Business Climate -10.3 forecast, -14.9 previous
•14:30 US Sep Dallas Fed Mfg Business Index -17.2 previous
•15:30 US 3-Month Bill Auction 5.315% previous
•15:30 6-Month Bill Auction 5.300% previous
Looking Ahead Events And Other Release(GMT)
22:00 US FOMC Member Kashkari Speaks
Currency Forecast
EUR/USD: The euro dipped on Monday after a survey showed German business morale deteriorated slightly in September, falling for the fifth month and underlining recession fears in the euro zone's largest economy. The Ifo institute said its business climate index stood at 85.7, a decline from a revised August figure of 85.8 but above the 85.2 forecast by analysts in a poll. The euro edged 0.1% lower to $1.0633, moving towards a six-month low of $1.0615 touched on Friday against a stronger dollar.The single currency was on track to lose roughly 1.9% for the month, its steepest monthly fall since May, amid growing recession fears’. Immediate resistance can be seen at 1.0653(5DMA), an upside break can trigger rise towards 1.0693(38.2%fib).On the downside, immediate support is seen at 1.0603(23.6%fib), a break below could take the pair towards 1.0570(Lower BB).
GBP/USD: The pound dipped to its lowest in six months against the dollar on Monday, as jitters across asset classes hurt the currency already bruised by markets' reevaluation of the Bank of England's rate outlook.The BOE kept rates on hold last week - the first meeting at which it had done so since December 2021 - on the back of signs economic growth is slowing.Market pricing prior to that meeting had reflected expectations that a further 25 basis point rate hike was all but certain for 2023, if not at that specific meeting, but, on Monday, expectations for a further rate hike this year were roughly 40%. Sterling, on Monday, dropped as much as 0.25% to $1.2213 its lowest since March 2023, though later steadied to trade flat on the day at $1.2242. Immediate resistance can be seen at 1.2290(5DMA), an upside break can trigger rise towards 1.2328(38.2%fib).On the downside, immediate support is seen at 1.2207 (23.6%fib), a break below could take the pair towards 1.2167(Lower BB).
USD/CHF: The U.S. dollar rose against Swiss franc on Monday as investors assessed U.S. Federal Reserve officials' warning of further interest rate hikes ahead of a consumer inflation gauge due later this week. Fed officials warned on Friday of further rate hikes even after voting to hold the benchmark rate steady last week, with three policymakers saying they remain uncertain the inflation battle is finished. Investors await the personal consumption expenditures (PCE) price index, the Fed’s preferred inflation gauge which lands on Sept. 29, while also keeping an eye on events in Washington, where U.S. lawmakers are haggling over a spending bill with a Sept. 30 deadline to avert a potential government shutdown. Immediate resistance can be seen at 0.9118 (23.6%fib), an upside break can trigger rise towards 0.9130 (Higher BB).On the downside, immediate support is seen at 0.9049(38.2%fib), a break below could take the pair towards 0.9036(5DMA).
USD/JPY: The dollar rose against the yen to an almost 11-month high on Monday following last week's gains, keeping traders focused on Japan intervention risks. The yen fell 0.17% to 148.66 per dollar, touching its lowest since late October and adding to Friday's declines after the BOJ maintained ultra-low interest rates, while Governor Kazuo Ueda stressed the need to spend more time assessing data before raising interest rates.The Japanese currency remained within striking distance of 150, a level which some market watchers saw as a line in the sand that would spur forex intervention from Japanese authorities similar to that of last year. Strong resistance can be seen at 148.12(23.6%fib) an upside break can trigger rise towards 148.76 (23.6%fib).On the downside, immediate support is seen 146.16(5DMA), a break below could take the pair towards 147.29 (38.2%fib).
Equities Recap
European shares fell at the start of the quarter's last week in volatile trading as worries about interest rates staying higher for longer and weakness in China-exposed shares weighed on the index.
At (GMT 12:46 ),UK's benchmark FTSE 100 was last trading down at 0.97 percent, Germany's Dax down by 1.09 percent, France’s CAC was down by 1.00 percent.
Commodities Recap
Oil prices held steady on Monday after Russia relaxed its fuel ban, taking the edge off earlier gains on a tighter supply outlook and wariness over interest rates that could curb demand.
Brent crude futures were up 17 cents, or 0.18%, at $93.44 a barrel by 1133 GMT after settling 3 cents lower on Friday.U.S. West Texas Intermediate crude was up 7 cents, or 0.08%, at $90.10.
Gold eased on Monday as the U.S. dollar stood strong after U.S. Federal Reserve officials flagged that interest rates would remain higher for longer, although moves were limited as investors look forward to inflation data later this week.
Spot gold was down 0.1% to $1,923.94 per ounce by 1153 GMT, while U.S. gold futures also fell 0.1% to $1,943.70.