Posted at 23 January 2024 / Categories Market Roundups
Market Roundup
•UK Dec Public Sector Net Cash Requirement 12.863B,12.453B previous
•UK Dec Public Sector Net Borrowing 6.85B,11.40B forecast,13.41B previous
Looking Ahead Economic Data(GMT)
•13:30 Canada Dec New Housing Price Index (MoM) 0.0% forecast,-0.2% previous
•13:55 US Redbook (YoY) 5.0% previous
•15:00 US Jan Richmond Manufacturing Index -7 forecast,-11 previous
•15:00 US Jan Richmond Manufacturing Shipments -17 previous
•15:00 EU Jan Consumer Confidence -14.3 forecast,-15.0 previous
•15:00 US Jan Richmond Services Index 0 previous
•16:30 US 52-Week Bill Auction 4.595% previous
•18:00 US 2-Year Note Auction 4.314% previous
Looking Ahead Events And Other Releases(GMT)
•No Significant events
Currency Forecast
EUR/USD: The euro dipped on Tuesday as investors remained cautious ahead of the European Central Bank's (ECB) policy meeting later this week. Market participants keenly await the ECB's monetary policy meeting, due on Jan. 25, for clues on the interest rate trajectory and the timing of rate cuts.While a pause in interest rate hikes is nearly priced in for the upcoming meeting, traders anticipate cuts of around 130 basis points this year, with a nearly 97% chance of the first reduction in June. The euro gave back earlier gains to tradedown at $1.0868. 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 Tuesday as markets awaited economic data that could offer clarity on the Bank of England's (BoE) monetary easing plans. Investors await readings on UK business activity as well as consumer confidence later this week to gauge how the British economy is faring and the BoE's interest rate trajectory. The main British economic news was a smaller-than-expected budget deficit for December, potentially opening up room for tax cuts in a budget scheduled for March. The pound was up 0.07% at $1.2721. 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 Tuesday as investors anticipated fresh U.S. economic data this week, which might set the tone for the Federal Reserve's policy meeting next week. Focus this week will be on the U.S. flash PMI report on Wednesday, fourth-quarter advance GDP estimates due on Thursday and personal consumption expenditures data on Friday. Markets widely expect the Fed to hold rates unchanged at the end of the policy meeting on Jan. 30-31 and have pared back the timing of the first interest rate cut, according to CME's FedWatch 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 Tuesday after the Bank of Japan (BOJ) maintained its ultra easy policy settings, but markets picked up signals that an end to its negative interest rate policy was approaching. BOJ Governor Kazuo Ueda gave no hints on whether the bank would pull short-term interest rates out of negative territory at its upcoming meetings in March or April, as many economists expect, he did say the likelihood of Japan sustainably achieving the bank's 2% inflation target was gradually increasing. The yen is sensitive to the difference in rates between Japan and other markets. The dollar was last down about 0.2% on the Japanese currency at 147.81, stabilising after a 4.8% climb so far this year. 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 equities edged lower on Tuesday as investors remained cautious ahead of the European Central Bank's (ECB) policy meeting later this week, while gains in mining stocks capped further declines.
At (GMT 13:22 ) UK's benchmark FTSE 100 was up by 0.02 percent, Germany's Dax was up by 0.01 percent, France’s CAC was down by 0.26 percent.
Commodities Recap
Gold prices were little changed on Tuesday, as investors looked forward to more U.S. economic data this week that could set the tone for the Federal Reserve's policy meeting next week.
Spot gold was up 0.1% at $2,023.90 per ounce by 1223 GMT. U.S. gold futures rose 0.2% to $2,026.30.
Oil prices fell on Tuesday, handing back some of the previous day's gains, as traders weighed rising crude supply in Libya and Norway against simmering geopolitical tensions in several regions and production outages in the United States.
Brent crude futures were down 59 cents, or 0.74%, to $79.47 a barrel at 1240 GMT, after trading $1 lower their intra-day nadir. U.S. West Texas Intermediate crude futures (WTI) were down 54 cents, or 0.72%, to $74.22 a barrel.