Posted at 16 January 2024 / Categories Market Roundups
Market Roundup
•German Dec CPI (MoM)0.1%,0.1% forecast,-0.4% previous
•German Dec German CPI (YoY) 3.7%,3.7% forecast,3.2% previous
•German Dec German HICP (MoM) 0.2%,0.2% forecast,-0.7% previous
•German Dec German HICP (YoY) 3.8%,3.8% forecast,2.3% previous
•UK Nov Unemployment Rate 4.2%,4.3% forecast,4.2% previous
•UK Nov Average Earnings ex Bonus 6.6%,6.6% forecast,7.3% previous
•UK Nov Employment Change 3M/3M (MoM) 73K,50K forecast,50K previous
•UK Nov Average Earnings Index +Bonus 6.5%,6.8% forecast,7.2% previous
•UK Dec Claimant Count Change 11.7K,18.1K forecast,16.0K previous
•German Jan ZEW Current Conditions -77.3,-77.0 forecast,-77.1 previous
•EU Jan ZEW Economic Sentiment 22.7, 21.9 forecast,23.0 previous
•German Jan German ZEW Economic Sentiment 15.2, 12.0 forecast,12.8 previous
Looking Ahead Economic Data(GMT)
•13:30 Canada Dec Housing Starts 243.0K forecast,212.6K previous
•13:30 Canada Dec Trimmed CPI (YoY) 3.5% forecast ,3.5% previous
•13:30 Canada Dec CPI (MoM) -0.3% forecast , 0.1% previous
•13:30 US Jan NY Empire State Manufacturing Index -5.00 forecast ,-14.50 previous
•13:30 Canada Dec Median CPI (YoY) 3.4% forecast ,3.4% previous
•13:30 Canada Dec CPI (YoY) 3.4% forecast , 3.1% previous
•13:30 Canada Dec Core CPI (YoY) 2.8% previous
•13:30 Canada Dec Core CPI (MoM) 0.1% previous
•15:00 New Zealand GlobalDairyTrade Price Index 1.2% previous
Looking Ahead Events And Other Releases (GMT)
• 16:00 US Fed Waller Speaks
• 15:00 UK GBP BoE Gov Bailey Speaks
Currency Forecast
EUR/USD: The euro declined on Tuesday after European Central Bank officials downplayed the idea of early rate cuts overshadowed the outlook for borrowing costs globally.The ECB's Joachim Nagel on Monday said it was too early to talk about cuts, and his Austrian colleague Robert Holzmann said markets should not bank on borrowing costs falling this year. Other policymakers on Tuesday maintained a cloud of uncertainty over the timing of the moves. Traders now see a near-25% chance of the first rate cut in March, down from more than 30% in the previous week. The euro fell 0.54% to $1.0892, set for its steepest one-day percentage drop in two weeks. Immediate resistance can be seen at 1.0934(50%fib), an upside break can trigger rise towards 1.0955(61.8%fib).On the downside, immediate support is seen at 1.0868(38.2%fib), a break below could take the pair towards 1.0853(Lower BB).
GBP/USD: The British pound declined against the dollar on Tuesday after data indicated a deceleration in the growth of British wages during the three months ending in November, reinforces the notion that the Bank of England may implement substantial interest rate cuts later this year. In the period from September to November, the yearly growth in earnings, excluding bonuses, registered at 6.6%, indicating a moderation from the 7.2% increase observed in the preceding three months through October. When bonuses are factored in, pay growth decelerated to 6.5%, down from 7.2% in the three months ending in October, falling short of economists' projections for a 6.8% figure. Sterling was last down 0.37% at $1.2679, having traded around 0.3% lower at $1.2683. Immediate resistance can be seen at 1.2745(38.2%fib), an upside break can trigger rise towards 1.2816(Higher BB).On the downside, immediate support is seen at 1.2628 (50%fib), a break below could take the pair towards 1.2600(Lower BB).
USD/CHF: The U.S. dollar steadied against Swiss franc on Tuesday as investors awaited comments from various Federal Reserve officials throughout the week, seeking insights into the central bank's future monetary policy direction. Investors awaited comments later on Tuesday from the Fed's Christopher Waller, whose dovish turn in late November helped to trigger a blistering year-end market rally. Markets are pricing in a 69% chance of a 25 bp cut in March from the Fed, versus 77% a day earlier and 63% a week earlier, the CME FedWatch Tool showed. Traders expect cuts of roughly 160 bps this year. Against a basket of currencies, the dollar rose 0.51%to 103.16, around a one-month high. Immediate resistance can be seen at 0.8632(38.2%fib), an upside break can trigger rise towards 0.8668(Higher BB ).On the downside, immediate support is seen at 0.8538(50%fib), a break below could take the pair towards 0.8459(61.8%fib)
USD/JPY: The dollar strengthened against the yen on Tuesday after figures showed Japan's wholesale price index stayed flat in December from a year ago, with the rate of change slowing for the 12th straight month. The data indicate that rises in consumer inflation will moderate in coming months, and take pressure off the Bank of Japan (BOJ) to phase out its massive monetary stimulus soon.The reading for the corporate goods price index (CGPI), which measures the prices companies charge each other for their goods and services, compared with a median market forecast for a 0.3% fall and followed a 0.3% increase in November.The result was the lowest since a 0.9% drop in February 2021, showed BOJ data released on Tuesday. The dollar was 0.58% higher against the Japanese yen , at 146.65 yen to the dollar, around a five-week high. Strong resistance can be seen at 146.97(23.6%fib),an upside break can trigger rise towards 147.48( Higher BB).On the downside, immediate support is seen 145.35(38.2% fib)a break below could take the pair towards 144.53(50%fib).
Equities Recap
European shares opened lower on Tuesday as investors reined in expectations of interest rate cuts following recent comments from European Central Bank officials, while shares of Lindt & Spruengli jumped on upbeat results.
At (GMT 13:32 ) UK's benchmark FTSE 100 was down by 0.31 percent, Germany's Dax was down by 0.38 percent, France’s CAC was down by 0.27 percent.
Commodities Recap
Gold prices declined on Tuesday, hurt by a strengthening dollar and Treasury yields, as markets wait to hear remarks from several Federal Reserve officials this week to further gauge the central bank's monetary policy path.
Spot gold was down 0.8% at $2,037.40 per ounce, as of 1212 GMT. U.S. gold futures fell 0.5% to $2,041.50.
Oil prices rose on Tuesday, as investors weighed the impact of tensions in the Middle East.
Brent crude futures gained 77 cents, or about 0.99%, to $78.92 a barrel at 1014 GMT. The contract had lost 14 cents on Monday.
U.S. West Texas Intermediate crude was up 46 cents, or 0.63%, from Friday at $73.14 per barrel. U.S. markets were closed for a public holiday on Monday.