Posted at 14 April 2022 / Categories Market Roundups
Market Roundup
• US Mar PPI (YoY) 11.2%,10.6% forecast,10.0% previous
• US March PPI (MoM)1.4%, 1.1% forecast, 0.8% previous
• US Mar Core PPI (MoM) 1.0%, 0.5% forecast,0.2% previous
• Canada BoC Interest Rate Decision 1.00%,1.00% forecast, 0.50% previous
•Crude Oil Inventories 9.382M,0.863M forecast,2.421M previous
Looking Ahead - Economic Data (GMT)
•01:30 Australia March Employment Change 40.0K forecast, 77.4K previous
•01:30 Australia March Unemployment Rate 3.9% forecast, 4.0% previous
•01:30 Australia March Full Employment Change 121.9K previous
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro rose against dollar on Wednesday as the euro reversed course and turned positive ahead of a policy-setting meeting at the European Central Bank on Thursday. Although the market is not anticipating any interest rate changes from the ECB at Thursday's meeting, market participants will be looking for a more hawkish tone from ECB President Christine Lagarde that could tee up a rate hike later in the year. Euro zone inflation came in at 7.5% in March, with a peak still seen months away , thus investors will scrutinize Thursday's ECB meeting for hints of more deliberate policy normalization policy. Immediate resistance can be seen at 1.0910(38.2%fib), an upside break can trigger rise towards 1.0982 (50%fib).On the downside, immediate support is seen at 1.0870(5DMA), a break below could take the pair towards 1.0816 (23.6%fib).
GBP/USD: Sterling edged up on Wednesday after briefly dropping to its lowest level against the U.S. dollar since November 2020 as British consumer price inflation leapt to its highest level in three decades.Raising doubts about how aggressive the Bank of England will be in tightening monetary policy, British consumer prices jumped to an annual rate of 7.0% in March, the highest since March 1992 and up from 6.2% in February.Sterling fell to $1.2973 in early London trading, hitting its lowest level against the dollar since November 2020. By 1430 GMT, it had risen 0.13% on the day to $1.3017.Immediate resistance can be seen at 1.3196(38.2%fib), an upside break can trigger rise towards 1.3220(25th March high).On the downside, immediate support is seen at 1.3094 (23.6%fib), a break below could take the pair towards 1.3061 (5DMA).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday, recovering from its lowest level in nearly four weeks, as oil prices climbed and the Bank of Canada announced its biggest single interest rate hike in more than two decades. The central bank raised its benchmark overnight rate to 1% from 0.5% and said it would allow government bonds it amassed during the COVID-19 pandemic to roll off as they mature from April 25, beginning what is known as quantitative tightening. The BoC last hiked by half a percentage point in May 2000,favoring instead quarter-point increments. The Canadian dollar was trading 0.6% higher at 1.2570 to the greenback, rebounding from its weakest intraday level since March 17 at 1.2676.Immediate resistance can be seen at 1.2598(38.2%fib), an upside break can trigger rise towards 1.2652(50%fib).On the downside, immediate support is seen at 1.2536(23.6%fib), a break below could take the pair towards 1.2484(April 6th low).
USD/JPY: The dollar dipped against the yen on Wednesday as investors shrugged off unexpectedly strong producer prices to mull the possibility that markets had already achieved peak Fed and U.S. inflation pricing. Data showing U.S. producer prices in March surging 11.2% on a year-on-year basis, the largest increase since 12-month data were first calculated in November 2010, reinforced market expectations that the Fed will raise interest rates by half a percentage point at next month's policy meeting . Against a basket of six major currencies, the dollar fell to 99.888, after climbing early in the day to 100.52, the highest since May 2020. Strong resistance can be seen at 126.26(23.6%fib), an upside break can trigger rise towards 127.00 (Psychological level).On the downside, immediate support is seen at 125.34(5DMA), a break below could take the pair towards 124.69(38.2%fib).
Equities Recap
European stocks were broadly lower on Wednesday after Russian President Vladimir Putin vowed to continue the invasion of Ukraine until "full completion" of goals.
UK's benchmark FTSE 100 closed up by 0.05 percent, Germany's Dax ended down by 0.34 percent, France’s CAC finished the day up by 0.07 percent.
Wall Street rallied to end sharply higher on Wednesday, powered by a recovery in interest-sensitive growth stocks as investors digested hot inflation data and a mixed bag of quarterly results.
Dow Jones closed up by 1.01 percent, S&P 500 closed up by 1.12 percent, Nasdaq settled up by 2.03 % percent.
Commodities Recap
Gold prices hit a one-month high on Wednesday as rising consumer prices boosted its appeal as an inflation hedge, with investors seeming to look past an impending interest rate hike by the Federal Reserve.
Spot gold rose 0.6% to $1,978.21 per ounce by 2:37 p.m. ET (1837 GMT), after touching its highest since March 14 at $1,981.30. U.S. gold futures settled up 0.4% at $1,984.70.
Oil prices jumped on Wednesday, as a large increase in U.S. crude inventories failed to soothe worries about tight global supply, with major oil traders expected to shun Russian barrels.
Brent crude settled up $4.14, or 4%, to $108.78. U.S. West Texas Intermediate (WTI) crude futures ended up $3.65, or 3.7%, to $104.25.