Posted at 22 January 2024 / Categories Market Roundups
Market Roundup
• Swiss Dec M3 Money Supply 1,136.2B , 1,132.5B previous
•Belgium Jan Consumer Confidence -2 , 0 previous
Looking Ahead Economic Data(GMT)
•13:55 French 12-Month BTF Auction 3.319% previous
•13:55 French 3-Month BTF Auction 3.829% previous
•13:55 French 6-Month BTF Auction 3.697% previous
•15:00 US Dec Leading Index (MoM) -0.3% forecast,-0.5% previous
•16:30 US 3-Month Bill Auction 5.225% previous
•16:30 US 6-Month Bill Auction 4.975% previous
Currency Forecast
EUR/USD: The euro was little changed on Monday investors awaited the European Central Bank's policy decision due this week. Investors are waiting for the ECB's monetary policy decision, due on Jan. 25, to ascertain the timing of interest rate cuts from the central bank. The debate has shifted somewhat as policymakers accept that the next move is a rate cut, but later and less than what markets expect.Market analysts think the ECB's inflation and growth outlook is wrong however, and market pricing currently indicates expectations of five 25 basis points cuts this year. The euro was down 0.1% at $1.0888. Immediate resistance can be seen at 1.0934(23.6%fib), an upside break can trigger rise towards 1.0970(Jan 15th High).On the downside, immediate support is seen at 1.0850(38.2%fib), a break below could take the pair towards 1.0832(Lower BB).
GBP/USD: The British pound traded in tight range against the dollar on Monday as markets weighed up last week's mixed data releases and their impact on monetary policy. Britain's annual rate of consumer price inflation sped up for the first time in 10 months last month, official data showed last week.But retail sales slumped 3.2% in December, the biggest fall since January 2021, and there were further signs of a loosening labour market as British wages grew at their slowest pace in almost a year, the Office for National Statistics said. The pound was last little changed at $1.2708, in the middle of the $1.2597-$1.2825 range it has traded in since December 14. Immediate resistance can be seen at 1.2729(23.6%fib), an upside break can trigger rise towards 1.2799(Higher BB).On the downside, immediate support is seen at 1.2633 (38.2%fib), a break below could take the pair towards 1.2592(Lower BB).
USD/CHF: The dollar was little changed against the Swiss franc on Monday as traders were in a wait-and-see mode, anticipating key U.S. economic data releases and closely monitoring major central bank policy meetings scheduled for the week. Data late last week showing U.S. economic activity remains resilient despite interest rates at their highest level in decades caused markets to scale back expectations of rate cuts beginning as soon as in March.Investors will be watching out for the U.S. flash PMI report on Wednesday, fourth-quarter advance GDP estimates due on Thursday and personal consumption expenditures data on Friday for more cues on interest rates. Traders now price in about a 48% chance that the Fed will cut interest rates in March, according to the CME Fed Watch Tool Immediate resistance can be seen at 0.8690 (38.2%fib), an upside break can trigger rise towards 0.8752 (23.6%fib).On the downside, immediate support is seen at 0.8638(50% fib), a break below could take the pair towards 0.8588 (61.8%fib).
USD/JPY: The dollar eased against the yen on Monday as mixed expectations regarding potential U.S. Federal Reserve rate cuts led to a temporary halt in the dollar's upward momentum. Market participants will closely monitor key events for further insights into interest rates, including the U.S. flash PMI report scheduled for Wednesday, fourth-quarter advance GDP estimates expected on Thursday, and personal consumption expenditures data on Friday. These releases will provide additional cues and information influencing expectations and decisions related to interest rates. Traders are currently assigning approximately a 48% probability to a Federal Reserve interest rate cut in March, as indicated by the CME Fed Watch Tool. Strong resistance can be seen at 148.77(23.6% fib),an upside break can trigger rise towards 149.42( Higher BB).On the downside, immediate support is seen 147.80(Daily low)a break below could take the pair towards 147.25(38.2%fib).
Equities Recap
European shares rose on Monday as they tracked a Wall Street rally that drove the benchmark S&P 500 to a record peak in the previous session, while investors awaited the European Central Bank's policy decision due this week.
At (GMT 13:22 ) UK's benchmark FTSE 100 was up by 0.15 percent, Germany's Dax was up by 0.40 percent, France’s CAC was up by 0.40 percent.
Commodities Recap
Gold prices declined on Monday, as hopes of a March interest rate cut by the Federal Reserve faded, while traders awaited key U.S. economic data and major central bank policy meetings this week.
Spot gold was down 0.2% at $2,026.40 per ounce, as of 1237 GMT. U.S. gold futures were steady at $2,029.00.
Oil prices edged higher on Monday as traders assessed the influence of conflicts in the Middle East and Ukraine on oil supply, balancing it against economic challenges that are putting pressure on global oil demand.
Brent crude rose 22 cents to $78.78 a barrel by 1141 GMT.The front-month U.S. West Texas Intermediate crude futures contract for February delivery was up 31 cents at $73.72 a barrel in tepid trade, with the contract set to expire on Monday.