Posted at 20 December 2022 / Categories Market Roundups
Market Roundup
•Finnish Nov Unemployment Rate 6.7%, 6.9% previous
•German Nov PPI (YoY) 28.2%,30.6% forecast, 34.5% previous
•German Nov PPI (MoM) -3.9%, -2.5% forecast, -4.2% previous
•Swiss Nov Trade Balance 2.307B, 4.140B previous
•EU Oct Current Account -0.4B, -8.1B previous
•EU Oct Current Account n.s.a -4.4B, 3.8B previous
•Belgium Dec Consumer Confidence -15, -22 previous
Looking Ahead - Economic events(GMT)
•13:30 US Nov Building Permits 1.485M forecast,1.512M previous
•13:30 Canada Oct Core Retail Sales (MoM) 1.4% forecast, -0.7% previous
•13:30 US Nov Housing Starts 1.400M forecast, 1.425M previous
•13:30 Canada Oct Retail Sales (MoM ) 1.5% forecast,-0.5% previous
•13:30 US Nov Building Permits (MoM) -3.3% previous
•13:30 US Nov Housing Starts (MoM) -4.2% previous
•13:55 US Redbook (YoY) 5.9% previous
•14:30 New Zealand GlobalDairyTrade Price Index 0.6% previous
•15:00 EU Dec Consumer Confidence -22.0 forecast, -23.9 previous
Looking Ahead - Economic events and other releases (GMT)
• No significant event
EUR/USD: The euro strengthened on Tuesday as market digested surprise policy tweak by Japan's central bank. The Bank of Japan (BOJ) widened the allowable band for long-term yields to 50 basis points either side of its 0% target, from 25 basis points previously. Investors were also reacting to comments by ECB policymaker Peter Kazimir that the monetary policy should tighten at a stable pace. On the data front, German producer price inflation eased more-than-expected in November to reach its lowest level in nine months amid a slowdown in the price growth of energy.Producer prices climbed 28.2 percent year-over-year in November, slower than the 34.5 percent surge in October. Immediate resistance can be seen at 1.0665(23.6%fib), an upside break can trigger rise towards 1.0718(Higher BB).On the downside, immediate support is seen at 1.0580(5DMA), a break below could take the pair towards 1.0495(38.2%fib).
GBP/USD: The pound edged higher on Tuesday against the U.S. dollar in thin trading ahead of the Christmas holidays, but was on track for its strongest quarterly gain against the dollar since 2009. Analysts are pessimistic about the outlook for sterling, with the British economy seen as likely to fare worse than its major peers in the coming years. The pound has surged 8.8% against the dollar in the final three months of the year, putting it on track for its best quarter for more than 13 years. Sterling was last up 0.1% against the dollar at $1.216, having fluctuated in and out of positive territory in afternoon trading in London. Immediate resistance can be seen at 1.2227( 5DMA), an upside break can trigger rise towards 1.2407(15th Dec).On the downside, immediate support is seen at 1.2111 (38.2%fib),a break below could take the pair towards 1.2037 (30DMA).
USD/CHF: The dollar dipped against the Swiss franc on Tuesday as greenback dipped after a surprise shift in the Bank of Japan's monetary policy, while markets also weighed the outlook for the U.S. Federal Reserve's interest rate strategy. The BOJ decided to allow the 10-year bond yield to move 50 basis points either side of its 0% target, wider than the previous 25 basis point band, in a move aimed at easing some of the costs of prolonged monetary stimulus.It was a move widely seen as a possible end to the central bank's ultra-loose monetary policy Immediate resistance can be seen at 0.9285(5DMA ), an upside break can trigger rise towards 0.9366(38.2%fib).On the downside, immediate support is seen at 0.9253(23.6%fib), a break below could take the pair towards 0.9211 (Dec 14th low).
USD/JPY: The dollar declined sharply against Japanese yen on Tuesday after the Bank of Japan stunned markets by deciding to review its yield curve control policy and widen the trading band for the 10-year government bond yield. While it kept broad policy settings unchanged - pinning short-term JGB yields at -0.1% and the 10-year yield around zero the BOJ decided to let long-term yields to move 50 basis points either side of its 0% target, wider than the 25 basis point band previously. The dollar last traded 3.5% weaker at 132.35 yen. It hit a low of 132 yen, a level last seen in mid-August. Strong resistance can be seen at 133.68(Aug 12th high), an upside break can trigger rise towards 134.88(38.2%fib).On the downside, immediate support is seen at 132.05(23.6%fib), a break below could take the pair towards 131.62(Aug 1st low).
Equities Recap
European stocks fell in cautious trade Tuesday after the Bank of Japan rattled markets with a surprise policy shift that allows long-term interest rates to rise more.
At (GMT 12:29) UK's benchmark FTSE 100 was last trading up at 0.01 percent, Germany's Dax was down by 0. 21 percent, France’s CAC was down by 0.21 percent.
Commodities Recap
Gold prices jumped 1% to above the key $1,800 level on Tuesday as the dollar dropped after the Bank of Japan's surprise policy tweak, while markets also weighed the outlook for the U.S. Federal Reserve's interest rate strategy.
Spot gold rose 1.1% to $1,806.34 per ounce by 1037 GMT. U.S. gold futures gained 1% to $1,816.20.
Oil prices rose on Tuesday, supported by a softer dollar and a U.S. plan to restock petroleum reserves, but gains were capped by uncertainty over the impact of rising COVID-19 cases in top oil importer China.
Brent crude futures were up 33 cents, or 0.41%, at $80.13 a barrel by 1215 GMT, adding to a 76 cent gain in the previous session.
U.S. West Texas Intermediate (WTI) crude futures for February delivery rose 57 cents, or 0.75%, to $75.95 after climbing 90 cents on Monday.