Posted at 12 April 2023 / Categories Market Roundups
Market Roundup
•U.S. CPI comes in below estimates, core in line with estimates
•Market bets on 25 bps Fed hike in May, pause in June
•US Mar Real Earnings (MoM) -0.1%, -0.2% forecast,-0.4% previous
•US Mar CPI Index, s.a 301.81, 302.60 forecast, 301.65 previous
•US Mar CPI, n.s.a (MoM) 0.40% forecast, 0.56% previous
•US Mar CPI (YoY) 5.0%,5.2% forecast, 6.0% previous
•US Mar CPI (MoM) 0.2% forecast,0.4% previous
•US Mar Core CPI (MoM) 0.1%,0.4% forecast, 0.5% previous
•US Mar Core CPI (YoY) 5.6%,5.6% forecast, 5.5% previous
•US Mar CPI Index, n.s.a. 301.84,302.25 forecast,300.84 previous
•US Mar Core CPI Index 305.24,305.57 forecast, 304.07 previous
•Canada BoC Interest Rate Decision 4.50%, 4.50% forecast,4.50% previous
•US Crude Oil Inventories 0.597M,-0.583M forecast,-3.739M previous
•US Mar Cleveland CPI (MoM) 0.4%, 0.6% forecast,0.6% previous
Looking ahead Economic Data(GMT)
•23:50 Japan Mar M3 Money Supply 2,100.5T previous
•23:50 Japan Mar Foreign Bonds Buying -483.4B previous
•23:50 Japan Foreign Investments in Japanese Stocks 62.2B previous
•01:00 Australia MI Inflation Expectations 4.8% forecast, 5.0% previous
•01:30 Australia Mar Employment Change 20.0K forecast, 64.6K previous
•01:30 Australia Mar Unemployment Rate 3.6% forecast,3.5% previous
•01:30 Australia Mar Participation Rate 66.6% forecast, 66.6% previous
•01:30 Australia Mar Full Employment Change 8.0K forecast,74.9K previous
•03:00 China Mar Trade Balance (USD) 39.20B forecast,116.88B previous
•03:00 China Mar Exports (YoY) -7.0% forecast,-6.8% previous
•03:00 China Mar Imports (YoY) -5.0% forecast-10.2% previous
Looking Ahead Events Other Releases(GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro firmed on Wednesday as the dollar weakened after data showed U.S. consumer prices rose less than expected in March, raising expectations that the Fed is likely to stop hiking rates after a possible increase in May. The Consumer Price Index (CPI) climbed 0.1% last month, below economists’ expectations for a 0.2% gain, and down from a 0.4% increase in February. In the 12 months through March, the CPI increased 5.0%, the smallest year-on-year gain since May 2021. The CPI rose 6.0% on a year-on-year basis in February.Excluding the volatile food and energy components, the CPI increased 0.4% last month after rising 0.5% in February. Sticky rents continued to drive core CPI. The euro reached $1.10005, the highest since Feb. 2, and was last at $1.09930, up 0.73% on the day. Immediate resistance can be seen at 1.0000(Psychological level an upside break can trigger rise towards 1.1025(23.6%fib).On the downside, immediate support is seen at 1.0933(5DMA), a break below could take the pair towards 1.0811(38.2%fib).
GBP/USD: The pound strenthed against dollar on Wednesday as signs of cooling inflation in the U.S., the world's largest economy, boosted investor sentiment. The Consumer Price Index (CPI) climbed 0.1% in March after advancing 0.4% in February. But in the 12 months through March, the core CPI gained 5.6%, after rising 5.5% on the same basis in February.Better-than-feared economic data this year has helped the pound be the best G10 performer against the U.S. dollar both simply because of improved economic prospects but also because it means the Bank of England cannot rely on a slowdown to rein in inflation. Immediate resistance can be seen at 1.2500(Daily high), an upside break can trigger rise towards 1.2540 (23.6%fib).On the downside, immediate support is seen at 1.2442(5DMA), a break below could take the pair towards 1.2365(38.2%fib).
USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday, as U.S. inflation data weighed on the greenback and the Bank of Canada pushed back against bets that it would shift to cutting interest rates this year.The Canadian central bank left its benchmark interest rate on hold at 4.50% as expected but struck a hawkish tone. The gain for the loonie came as data showed U.S. consumer prices rising less than expected in March, raising expectations that the Federal Reserve is likely to stop hiking rates after a possible increase in May. The Canadian dollar was up 0.2% at 1.3435 to the U.S. dollar, or 74.43 U.S. cents, after trading in a range of 1.3429 to 1.3489. Immediate resistance can be seen at 1.3474 (5DMA), an upside break can trigger rise towards 1.3505 (38.2%fib).On the downside, immediate support is seen at 1.3441 (23.6%fib), a break below could take the pair towards 1.3296 (Feb 16th low).
USD/JPY: The dollar dipped against the yen on Wednesday after data showed cooler-than-expected headline inflation in March, suggesting the Federal Reserve may pause monetary tightening following one more rate hike next month. Data showed the U.S. consumer price index rose 0.1% last month after advancing 0.4% in February. In the 12 months through March, the CPI increased 5.0%, the smallest year-on-year gain since May 2021.Core inflation, however, remained elevated. Excluding the volatile food and energy components, the CPI increased 0.4% last month after rising 0.5% in February. Sticky rents continued to drive core CPI. Strong resistance can be seen at 134.12(Daily high), an upside break can trigger rise towards 134.95(50%fib).On the downside, immediate support is seen at 132.88(38.2%fib), a break below could take the pair towards 132.28(11DMA).
Equities Recap
Europe's blue-chip stocks hit their highest in 22 years on Wednesday as investors sought mega-cap quality stocks and as investors weighed whether the Federal Reserve could pause its rate hikes after evidence of cooling U.S. inflation.
UK's benchmark FTSE 100 closed up by 0.50percent, Germany's Dax ended up by 0.31 percent, France’s CAC finished the day up by 0.09percent.
U.S. stocks ended lower on Wednesday after minutes from the Federal Reserve's March policy meeting revealed concern among several members of the Federal Open Markets Committee (FOMC) regarding the regional bank liquidity crisis.
Dow Jones closed down by 0.11 percent, S&P 500 was down at 0.41 percent, Nasdaq was up by 0.85 percent.
Treasuries Recap
U.S. Treasury yields dropped on Wednesday after data showing cooler-than-expected headline inflation for March but elevated core consumer prices, suggesting the Federal Reserve could still raise interest rates at the next policy meeting - but may pause after that.
U.S. 10-year yields fell 5.5 bps to 3.381%. U.S. two-year yields also slid, down 12.5 bps at 3.932%.
Commodities Recap
Gold prices jumped on Wednesday as signs of cooling inflation bolstered bets that the U.S. Federal Reserve may pause its policy tightening after a likely interest rate hike in May.
Spot gold was up 0.6% at $2,014.39 per ounce by 2:10 p.m. EDT (18:10 GMT), after rising as much as 1.3% earlier. U.S. gold futures settled 0.3% higher at $2,024.90.
Oil prices rose 2% on Wednesday to their highest in more than a month as cooling U.S. inflation data spurred hopes that the Federal Reserve is getting closer to ending its cycle of interest-rate hikes and cushioned the impact of a small build in U.S. crude oil stocks.
Brent crude settled up $1.72, or 2.01%, at $87.33 a barrel, its highest since late January, while U.S. West Texas Intermediate closed up $1.73, or 2.1%, to $83.26, its highest in five months. Prices rose about 2% on Tuesday.