Posted at 20 September 2022 / Categories Market Roundups
Market Roundup
•Swiss Aug Trade Balance 3.424B, 3.585B previous
•German Aug PPI (MoM) 7.9%, 1.6% forecast, 5.3% previous
•German Aug PPI (YoY) 45.8%, 37.1% forecast, 37.2% previous
•Spanish Trade Balance -6.56B, -5.39B previous
•EU Aug Jul Current Account -19.9B, 5.3B forecast, 4.2B previous
•Greek Jul Current Account (YoY) 1.104B,-0.723B previous
Looking Ahead - Economic Data (GMT)
•12:30 Canada Median CPI (YoY) 5.0% forecast, 5.0% previous
•12:30 Canada Common CPI (YoY) 5.5% forecast, 5.5% previous
•12:30 Canada Trimmed CPI (YoY) 5.5% forecast, 5.4% previous
•12:30 Canada Aug CPI (MoM) -0.1% forecast,0.1% previous
•12:30 US Aug Building Permits 1.610M forecast,1.685M previous
•12:30 US Aug Housing Starts 1.445M forecast,1.446M previous
•12:30 Canada Aug CPI (YoY) 7.3% forecast,7.6% previous
•12:30 US Aug Housing Starts (MoM) -9.6% previous
•12:30 US Aug Core CPI (MoM) 0.5% previous
•12:30 US Aug Core CPI (YoY) 6.1% previous
•12:55 US Redbook (YoY) 11.4% previous
•15:00 New Zealand GlobalDairyTrade Price Index 4.9% previous
Looking Ahead - Economic events and other releases (GMT)
•No events ahead
EUR/USD: The euro edged lower against dollar on Tuesday as investors braced for a hefty U.S. Federal Reserve interest rate hike this week to combat inflation. The Federal Reserve is expected to raise its policy rate by at least 75 basis points on Wednesday, while investors are also awaiting the U.S. central bank's future policy projections. ECB Chief Economist Philip Lane said last week the central bank could raise interest rates into next year, and a recession could not be ruled out. The exact number of further interest rate increases by the ECB will depend on upcoming macroeconomic data, ECB Vice-President Luis de Guindos said on Monday. Immediate resistance can be seen at 1.0013(9DMA), an upside break can trigger rise towards 1.0034 (38.2%fib).On the downside, immediate support is seen at 0.9943(23.6%fib), a break below could take the pair towards 0.9902(Lower BB).
GBP/USD: The British pound was little changed against the dollar on Tuesday, hovering barely above its lowest level since 1985, ahead of expected interest rate hikes from the Bank of England (BoE) and Federal Reserve (Fed). In what is expected to be a big week for the pound, it also faces a “fiscal event” from British finance minister Kwasi Kwarteng, expected on Friday, where he is due to deliver more details on the size of the government’s energy support package. Money markets fully price in a half-point rate hike from the BoE on Thursday, with around a 75% chance of a larger 75 basis point rate rise. The pound was little changed against the dollar at $1.1432, just above last week’s 37-year low of $1.1351. Immediate resistance can be seen at 1.1465(5DMA), an upside break can trigger rise towards 1.1549 (38.2%fib).On the downside, immediate support is seen at 1.1404 (23.6%fib), a break below could take the pair towards 1.1333(Lower BB).
USD/CHF: The dollar strengthened against the Swiss franc on Tuesday as investors held firm in expectation of another aggressive rate hike by the Federal Reserve, the centrepiece of a week packed with central bank meetings. Markets have fully priced another 75 basis point increase, with around a 15% chance of a super-sized full percentage point increase, according to CME's Fedwatch tool.The dollar index , which measures the greenback against six counterparts, was 0.2% stronger 109.82, heading back to the 110.79 it hit earlier this month, a level not seen since June 2002. Immediate resistance can be seen at 0.9664 (38.2%fib), an upside break can trigger rise towards 0.9732 (23.6%fib).On the downside, immediate support is seen at 0.9636 (5DMA), a break below could take the pair towards 0.9610(38.2%fib).
USD/JPY: The dollar edged up against the Japanese yen on Tuesday as the Federal Reserve geared up for a hefty rate hike to tame inflation pressures. The Fed at the conclusion of its two-day policy meeting on Wednesday will likely deliver its third straight super-sized 75 basis point interest rate hike. The Bank of Japan also meets this week but is widely expected to keep its ultra-easy stimulus settings unchanged including pinning the 10-year yield near zero -- to support a fragile economic recovery. The yen has taken a kicking due to this policy and the dollar was last up 0.27% on the Japanese currency at 143.59, continuing a week-long consolidation after climbing as high as 144.99 on Sept. 7 for the first time in 24 years. Strong resistance can be seen at 144.12 (23.6%fib), an upside break can trigger rise towards 145.00(Psychological level). On the downside, immediate support is seen at 142.39 (5DMA), a break below could take the pair towards 141.83 (38.2%fib).
Equities Recap
European stocks reversed course to edge lower on Tuesday as investors remained focused on a round of interest-rate decisions by central banks such as the Fed and the BoE this week.
At (GMT 12:20),UK's benchmark FTSE 100 was last trading down at 0.18 %percent, Germany's Dax was down by 0.83 % percent, France’s CAC was last down by 1.00% percent.
Commodities Recap
Gold prices dipped on Tuesday, weighed down by a firmer dollar and elevated U.S. bond yields, as the Federal Reserve gears up for a hefty rate hike to tame inflation pressures.
Spot gold fell 0.5% to $1,668.30 per ounce by 1107 GMT. U.S. gold futures were little changed at $1,676.60.
Oil prices ticked up on Tuesday as OPEC and its allies keep producing less than their quotas, but were headed for a fourth monthly decline ahead of an expected further U.S. interest rate hike which may curb economic growth and fuel demand.
Brent crude futures for November settlement were up 41 cents, or 0.5%, to $92.41 a barrel at 0939 GMT.
U.S. West Texas Intermediate crude for October delivery was at $85.82 a barrel, up 9 cents.