EUR/USD Stalls in Non-Directional Movement Near 1.0950
The EUR/USD has been moving in a non-directional way for the past six days, hovering around the area close to 1.0950 which is near the median line. There has been no significant movement or change from yesterday. The next resistance level is at 1.1000, while the support level is close to 1.0850.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1200
1.1100
1.1000
1.0900
1.0850
1.0750
GBP/USD's Long Bullish Trend Faces Resistance with Channel Support
The GBP/USD is currently in the price accumulation phase where the pair is correcting for the second day. The long bullish trend faces a challenge from the resistance level at 1.2800. The down parallel of the channel is acting as support.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.2930
1.2800
1.2700
1.2630
1.2500
1.2400
USD/JPY Tests 145.00 for Breakout, Eyes Next Resistance at 148.30
The USD/JPY is testing the 145.00 level again for a breakout. The next resistance level is at 148.30, while the next support level is at 144.80.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
148.30
145.00
144.80
140.00
138.00
Gold Outlook Shifts to Neutral with Resistance at 2050
Gold prices have been attempting to recover for the second day following a short-term bearish trend. However, the current outlook is somewhat neutral. In case the rebound persists, the next resistance level will be at 2050. Conversely, if the prices keep declining, the next support level is at 2006.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2140
2090
2050
2032
2006
1979
WTI Crude Oil Price Displays Unpredictable Unidirectional Swings
WTI crude oil price continues its volatile unidirectional movements, as the market is still divided on the direction oil prices will take next impacted by geopolitics tensions and slowing demand. The overall outlook remains uncertain due to unclear market fundamentals. The resistance area is currently between 74 and 76, while support can be found at 68. The trend is currently bearish.
EUR/USD Holds Near Median Line with Data Uncertainty
The EUR/USD is hovering around the median line without a clear direction after yesterday's data. Today's PPI data may provide more direction. The next resistance level is at 1.1000, while the support level is close to 1.0850.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1200
1.1100
1.1000
1.0900
1.0850
1.0750
GBP/USD Approaches 1.2800 Resistance, Correction May Target 1.2630
The GBP/USD currency pair came close to the resistance level of 1.2800. Data from yesterday didn’t support a breakout or a correction as uncertainty continues. If prices break out, they may reach the next target of 1.2930. However, if there is a correction, prices may fall back to 1.2630.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.2930
1.2800
1.2700
1.2650
1.2500
1.2400
USD/JPY Faces 50MA Resistance, Undergoes Slight Correction
The USD/JPY encountered resistance from the 50MA and is currently undergoing a slight correction. There is no confirmation yet of a clear direction for the pair, but the next support level is at 144.00. As the fundamentals decline, the yen may weaken further, while the direction of the pair will also depend on the dollar.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
155.00
152.00
148.30
145.00
144.80
140.00
Gold Prices Rebound on Treasury Yield Dip, Decline May Test 2006 Support
Today, gold prices bounced back following a drop in the treasury yield. If the rebound is sustained, the next resistance level will be at 2050. However, if prices continue to fall, the next support level will be at 2006.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2140
2090
2050
2032
2006
1979
WTI Rises as 50MA Poses Temporary Challenge, Bearish Trend Prevails
WTI is moving up today following the geopolitical tension in the Middle East where the 50MA may be temporarily a challenge for the price. The resistance area is between 74 and 76, while support is at 68. The trend is currently bearish.
EUR/USD Uncertainty Continues, Eyes the 1.1000 Resistance Level
The EUR/USD continues to hover around the median line without a clear direction after last week's data. This week's data may give more direction for the pair. The next resistance level is at 1.1000, while the support level is close to 1.0850.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1200
1.1100
1.1000
1.0900
1.0850
1.0750
GBP/USD Still Unclear with Correction Possibility
The GBP/USD currency pair found resistance at 1.2800 the direction is still unclear while the market is still uncertain. If prices break out, they may reach the next target of 1.2930. However, if there is a correction, prices may fall back to 1.2630.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.2930
1.2800
1.2700
1.2650
1.2500
1.2400
USD/JPY Pair Unclear as Fundamentals Deteriorate
The USD/JPY encountered resistance from the 50MA and is building a reversal in the short term. There is no confirmation yet of a clear direction for the pair, but the next support level is at 144.80. As the fundamentals deteriorate, the yen may weaken further, while the direction of the pair will also depend on the Dollar.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
155.00
152.00
148.30
144.80
144.00
142.00
Gold; Safe Haven Amidst Geopolitical Tensions
Gold is benefiting from geopolitical tensions increasing the heaven gold appeal. If the trend continues the next target will be 2070, Conversely, if the prices come back declining, the next support level is in 2032.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2140
2090
2070
2032
2006
1979
Oil Prices Face a Challenge with 50MA, Trend Bearish
The 50-day moving average (50MA) poses a challenge for the price, as it could potentially lead to a reversal. Meanwhile, the path of the oil price remains uncertain. Currently, the resistance area is between 74 and 76, with support found at 68. The trend is currently bearish in an accumulation phase.
EUR/USD Declines, Eyes 200MA at 1.0850 with Dollar Strength
The EUR/USD is currently experiencing a decline, breaching the median line. Although the 50-day moving average (50MA) could serve as a transient support level, the focus is now on the 200-day moving average (200MA) with a target set at 1.0850. The main force driving this movement is the strength of the dollar.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1200
1.1100
1.1000
1.0900
1.0850
1.0750
GBP/USD Corrects to 1.2600, Eyes 50MA Support
The GBP/USD currency pair is correcting toward 1.2600 where the 50MA also is placed while the 1.2540 is the strong next support with the 200MA. The long bullish tends to remain strong and the correction can be temporary.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.2930
1.2800
1.2700
1.2600
1.2500
1.2400
USD/JPY Gains Momentum, Approaches 147.40 Resistance
The USD/JPY is on an upward trajectory, supported by the resilience of the dollar and the yen's weakness. The pair is advancing towards the upcoming resistance, situated at both the upper parallel of the downtrend and the 100-day moving average at 147.40.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
155.00
152.00
147.40
145.00
144.80
140.00
Gold Correction Following Strong Dollar and Rising Yields
Gold is currently influenced by the strength of the dollar and rising treasury yields, undergoing a correction from its recent level of 2056. While this correction may be temporary, the next support level is expected to be 2036, signaling a potential stabilization point for the precious metal.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2140
2090
2070
2036
2006
1979
Stable Oil Prices with Uncertain Fundamentals and Geopolitical Tensions
Over the last three days, oil prices have remained stable without showing any significant movements. The uncertain fundamentals of the oil market and the geopolitical tensions have made the market picture unclear and blurred. Currently, the resistance level is at 50MA, while the support level stands at 70.
EUR/USD Support at 1.0850, Key Data and Events Awaited
The EUR/USD is currently nearing the support level of 1.0850. Although a rebound from this support is possible, today's important data and events may impact its direction. If a breakout continues, then the next target would be 1.0800, while the next resistance level is at 1.0920.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0920
1.0850
1.0800
1.0750
GBP/USD Holds Firm at 1.2600 with Potential Direction to 1.2700
The GBP/USD found support at the 1.2600 at the 50MA. A rebound may lead the price to 1.2700, while a breakout below the 50MA could find support at 1.2540.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.2930
1.2800
1.2700
1.2600
1.2500
1.2400
Yen Faces Continued Downward Pressure while USD/JPY Strengthens
The dollar has gained strength against the yen, with USD/JPY on the rise, aiming for the next target at 148.35. The yen's downward trajectory may persist, as current fundamentals do not favor the currency.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Prices React to USD Strength and Yields, 50MA Support Crucial
Gold prices are currently being affected by the strength of the US dollar as well as rising treasury yields. Currently, it is at the 50MA support level and whether the correction will continue or not depends on today's economic calendar. If it continues to decline, the price is expected to drop towards the 2006 support level, while a comeback will push the price towards 2056 as the next target.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2090
2070
2056
2021
2006
1979
Oil Still Uncertain with Modest Movements, Support at 70
Oil lacks clear direction, displaying modest fluctuations following recent losses over the past two days. The next support stands at the 70 level, with an uncertain overall outlook and unpredictable market movements.
EUR/USD Rebounds with Support at Key Levels
The EUR/USD has garnered support from both the 200MA and the 1.0850 level, currently showing signs of a rebound. The trajectory of this rebound may be influenced by today's data, potentially paving the way for either a sustained recovery or a breakout. The next support is at 1.0800 and the next resistance is at 1.0900.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
GBP/USD Eyes the 1.2800 Level After Meeting Expectations
The GBP/USD discovered support at the 1.2600 level with 50MA. As anticipated, the rebound propelled the price back towards 1.2700. If this upward momentum persists, the next target stands at 1.2800.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Suport 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Faces Resistance at 148.35, Eyes 146.50
The USD/JPY pair encountered resistance at 148.35, as predicted. The next support is at 146.50. If a breakout occurs, the next target is 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Nears Support at 2006 with Yields and Dollar Pressure
Gold is currently trading at a support level of 2006. The recent rise in yields and the value of the dollar have had a negative impact on gold. However, gold will likely rebound from this support level. If gold does break out of this support level, the next target will be 1979.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2056
2021
2006
1979
1960
Oil Displays Ambiguous Pattern, Next Resistance at 50MA
Oil is exhibiting an unclear pattern with low probability projections. The next support is at 70, while the resistance is at 50MA.
The EUR/USD Support Hovers Around 200MA
The EUR/USD continues hovering around the support at the 200MA and the 1.0850 and rebounding at the moment. The next support is at 1.0800 and the next resistance is at 1.0900.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
GBP/USD Faces Selling Pressure Today
The GBP/USD rebounded after the 1.2600 support level, reaching the 50-day moving average (50MA). However, today the pair is experiencing selling pressure following the release of retail sales data. The next resistance if the rebound continues is at 1.2800 while the 50MA will be the next support.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Still Muted on the Second Day
The USD/JPY pair remained unchanged for the second day at the 148.35 resistance level. The next support is at 146.50. If a breakout occurs, the next target is 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Rebounds as Bearish Trend Goes Down
Gold is rebounding after the 2006 played support and the next resistance level is at 2052 while the short-term bearish trend is forming a down channel.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2052
2021
2006
1979
1960
Oil: A Possible Reversal?
Oil has broken the 50MA and is rebounding towards the next target at 78. The down-long trend indicates a possible reversal.
EUR/USD Hovers Around 200MA for the Fourth Session
The EUR/USD continues hovering for the fourth session around the support at the 200MA and the 1.0850 and rebounding at the moment. The next support is at 1.0800 and the next resistance is at 1.0900.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
GBP/USD Silently Awaits the Week’s Data
The GBP/USD is quiet today. The next move will depend on this week's data and market sentiment. The next resistance if the rebound continues is at 1.2800 while the 50MA will be the next support.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Muted at the 148.35 Resistance
The pair continued for their third day, muted at the 148.35 resistance level. The next support is at 146.50. If a breakout occurs, the next target is 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Resists at 200MA, Eyes 2006
Gold found resistance at the 200MA on a 4H chart and came back where the short-term bearish trend is still active. If it continues its downward trajectory, the next level is again will be at 2006.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2052
2021
2006
1979
1960
Uncertainty Continues for Oil at 50MA
Geopolitical tensions continue to impact oil prices, leaving future projections uncertain. The 50MA still holds as resistance.
EUR/USD Maintains Position Near 200MA Support at 1.0850
EUR/USD, rebounding currently, continues hovering around the support at the 200MA again with the 1.0850 level. The next support is at 1.0800 and the next resistance is at 1.0900.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
Pound Sterling Gains Momentum with Slight Restraint
The GBP/USD is increasing today but is slightly limited. The next move will depend on this week's economic data and market sentiment. The next resistance level is at 1.2800 while the 50MA will act as the next support if the rebound continues.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Retreats from 148.35 Resistance Post-BoJ Meeting
The USD/JPY pair came back from the resistance at 148.35 after today's BoJ meeting. The next support is at 146.50 and if a breakout occurs, the next target is 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Faces Resistance at 200MA, Extends Short-Term Bearish Trend
Gold continued finding resistance at the 200MA on a 4H chart and came back where the short-term bearish trend is still active. The next level will be at 2006 again if it continues its downward course.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2052
2021
2006
1979
1960
Geopolitical Tensions Increases Volatility in Oil Prices
Geopolitical tensions create volatility in oil prices again, leaving future projections uncertain. The 50MA seems still holding as resistance.
EUR/USD Holds Steady at 200MA Support, Awaits Data for Next Move
The EUR/USD pair maintains its position near the 200MA support at 1.0850, in a holding pattern as it awaits today's data developments to determine its next direction. The next support is at the 1.0800 level, with resistance at 1.0900 on the horizon.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
GBP/USD Sees Incremental Gains Today with Some Constraints
GBP/USD experienced gains today but faces mild constraints, with the upcoming move dependent on today's economic data and market sentiment. Although the current pattern somewhat resembles a descending triangle, the likelihood remains low. If the rebound persists, the next resistance is at 1.2800, with the 50MA serving as the next support.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Eyes 146.50 Support with Yen Strength Limited
The uncertainty persists for the USD/JPY pair near the 148.35 resistance following the recent BoJ meeting, with the Yen displaying limited strength. The next support lies at 146.50, and in the event of a breakout, the next resistance is set at 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Maintains Short-Term Bearish Trend Following Market Uncertainty
Uncertainty in the market is affecting gold, keeping it in proximity to both the 50MA and the 200MA on a 4-hour chart. The short-term bearish trend is still active. If it continues down the next levels again at the 2006.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2052
2021
2006
1979
1960
Oil Influenced by Ongoing Tensions, Remains Muted
Oil remains in a state of uncertainty, exhibiting volatile movements with no clear direction established, influenced by economic uncertainty and geopolitical tensions. The next resistance looms near 78, closely tied to the 200MA, while support rests at 70.
EUR/USD Volatility Follows PMI Data
The EUR/USD had strong volatility yesterday after PMI data while still hovering around the support at the 200MA and the 1.0850, waiting for today's GDP data for direction. The next support is at the 1.0800 level and the next resistance is at 1.0900.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.1100
1.1000
1.0900
1.0850
1.0800
1.0750
GBP/USD Stalls in Price Range with Growing Uncertainty
The GBP/USD is experiencing range-bound movements due to increasing uncertainty at the start of the new year. The next resistance if the rebound continues is at 1.2800 while the 50MA will be the next support.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
1.3100
1.2930
1.2800
1.2600
1.2500
1.2400
USD/JPY Dependent on Dollar Movements
The USD/JPY pair is making some corrections but limited as it will depend on US dollar movements for today. The next support is at 146.50. If a breakout occurs, the next target is 150.00.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
152.00
150.00
148.35
146.50
144.80
144.00
Gold Slips Following US PMI Data
Gold is falling today after yesterday's US PMI data where markets believe US economic resilience and rates will be held for longer. The short-term bearish trend is still active. If it continues to decrease, the next level will be at 2006 again.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
2070
2052
2021
2006
1979
1960
Crude Oil Initiates Reversal, Next Resistance at 78
Recent market trends indicate a potential reversal in oil prices, with the commodity poised for an upward movement. The next significant resistance level stands near the 200-day moving average, hovering around 78 and the support level remains steady at 70.
Resistance 3
Resistance 2
Resistance 1
Support 1
Support 2
Support 3
81
78
74
70
68
64.9
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Dollar Maintains Steady Position Near Six-Week Peak, Eyes on ECB and BoE Policies
On Thursday, the dollar maintained a steady position, close to a six-week peak, as investors waited for key economic data, including the first reading of the US Gross Domestic Product (GDP) for the fourth quarter which is expected to reveal a 2% annualized growth. Recent data showed powerful US business activity in January, with expansions in both services and manufacturing sectors.
Attention is also focused on the European Central Bank (ECB), with markets predicting it will maintain its current high interest rates at its January meeting. ECB President Lagarde hinted at a potential rate cut during the summer of 2024, highlighting a data-dependent approach. The market currently estimates a 60% likelihood of an initial rate reduction as soon as April.
The Bank of England (BoE) is expected to maintain current rates on February 1 and begin reducing rates in August. This anticipation follows a significant drop in inflation, which peaked at 11.1% in October 2022, the highest in 40 years. The Pound Sterling initially gained support from positive Purchasing Managers Index (PMI) data from the UK but lost momentum following strong PMI results from the US.
In Japan, the Bank of Japan (BoJ) acknowledged the alignment of conditions for phasing out stimulus and negative interest rates. The head of Japan's largest business lobby, Keidanren, advocated for wage increases above the inflation rate, suggesting a shift in the BoJ's monetary policy. Despite geopolitical tensions and global economic uncertainty, the Japanese Yen (JPY) is expected to avoid significant losses.
The Yuan remained stable after an announcement by China's central bank on Wednesday. The bank made a significant cut to bank reserves that will add approximately $140 billion of cash into the banking system. This move is a strong indication of support for the economy, which is currently fragile.
Gold prices lingered near a one-week low, affected by the stronger US dollar and higher bond yields after the US reported strong business activity. Investors are expecting further US GDP data and the ECB's policy meeting outcomes. Gold reached its lowest point in nearly a week following data indicating a strong start to the US economy in 2024.
Lastly, oil prices increased after reports showed a greater-than-expected decline in US crude stockpiles. Additionally, the Chinese central bank's reduction of banks' reserve ratios supported hopes for further stimulus measures and economic recovery.
Global Financial Markets Respond to Central Bank Moves with Inflation and Policy Shifts
On Tuesday, the dollar index remained steady reaching its highest position in nearly two weeks. This stability is attributed to investors reevaluating their expectations for early interest rate cuts by the Federal Reserve, influenced by strong US inflation figures. The Federal Reserve is expected to maintain current interest rates this week, with market attention turning to indications of the timing and magnitude of a potential easing cycle later in the year.
At its March meeting, the European Central Bank (ECB) kept interest rates unchanged, with officials signaling improvements in inflation control and initiating discussions on the timeline for rate reductions. ECB member Pablo Hernandez de Cos mentioned the possibility of starting to reduce interest rates in June, contingent on a continued decline in Eurozone inflation. Fellow Governing Council member Klaas Knot also targeted June for an initial rate cut, forecasting a total of three reductions within the year.
Market focus is also set on the upcoming German and Eurozone ZEW Survey, expected later on Tuesday. In the United Kingdom, signs of moderating inflation are emerging, though the Bank of England (BoE) remains cautious, awaiting inflation's return to the 2% target before altering rates. It is anticipated that the BoE will maintain its interest rate at 5.25% in Thursday's meeting, with investors keenly awaiting the release of consumer and producer price data on Wednesday.
Recent Consumer Inflation Expectations in the UK, showing a slight decrease from 3.3% to 3.0%, sparked speculation about a potential BoE rate cut, with predictions pointing towards August for the commencement of rate reductions.
In Japan, the yen experienced a significant drop following the Bank of Japan's (BoJ) decision to conclude its negative interest rate policy, marking an end to eight years of this approach and signaling a departure from prolonged monetary stimulus measures.
Gold prices hovered around $2,160 on Tuesday, as investors hesitated to make substantial moves ahead of the Federal Reserve's policy decision. Despite expectations for the Fed to keep interest rates unchanged, recent strong inflation data has led traders to reconsider bets on a rate cut in June.
Lastly, recent Ukrainian drone attacks on Russian oil refineries have the potential to increase Russia's crude oil exports. This development has encouraged bullish traders to secure profits after a significant rally in oil prices, cautioning against short-term market overextensions.
Global Central Banks Signal Rate Cuts, Dollar Weakens as Gold and Oil Rise
The dollar index experienced a decline, approaching 103 on Thursday, which marked a continuation of its downward trajectory from the prior session, reaching lows not seen in a week. This movement was influenced by the Federal Reserve's decision to maintain its forecast for three interest rate cuts within the year, despite leaving rates unchanged in March, a move that met widespread expectations. The central bank also adjusted its outlook slightly, indicating one fewer cut in 2025. Chairman Powell, during a regular press conference, emphasized that inflation data from January and February did not change the overall narrative surrounding inflation. He restated the need for policymakers to gain more confidence that inflation is consistently moving towards a 2% target before making any future policy adjustments, which will be guided by economic data.
In Europe, Christine Lagarde, the President of the European Central Bank (ECB), highlighted on Wednesday that the decision to cut interest rates would be deliberated in the June meeting. This consideration will be based on data available by June, which is expected to provide clearer insights into inflation trends and the state of the labor market. The anticipation in the money markets is for the ECB to implement three rate cuts by the end of the year, with a potential fourth cut being speculated, according to reports by Reuters.
Key economic indicators to be released include the HCOB Purchasing Managers Index (PMI) for Germany and the Eurozone on Thursday, along with the German Buba Monthly Report. Meanwhile, the Bank of England (BoE) is anticipated to maintain its policy rate for the fifth consecutive meeting on Thursday. This comes amid increasing speculation about potential interest rate cuts, with recent data suggesting a hastening in the pace of disinflation in the UK in February, which could lead to an earlier start to interest rate reductions.
Inflation metrics in the UK indicated that the Consumer Price Index (CPI) rose by 3.4% year-over-year in February, with the Core CPI (excluding food and energy costs) increasing by 4.5%. The Bank of Japan (BoJ) earlier this week signaled its intention to keep financial conditions accommodative, without providing specific guidance on future policy directions or normalization pace. This stance, combined with a general risk-on sentiment, contributed to a decline in demand for the traditionally safe-haven Japanese Yen.
Gold prices reached new highs following the Fed's reaffirmation of its interest rate cut outlook for the year, with the metal's appeal inversely related to interest rates. Gold's value surged past the $2,200 mark as bond yields decreased. Additionally, oil prices rebounded on Thursday, supported by a notable drawdown in US crude and gasoline stocks, despite indicators that the Federal Reserve might maintain higher interest rates for an extended period. Inventory levels unexpectedly fell by 2 million barrels to 445 million barrels for the week ending March 15, contrary to analysts' expectations of a 13,000-barrel increase, based on a Reuters poll.
Dollar Dominance Continues Amid Global Rate Shifts: A Week in Review
The U.S. dollar was set for a second week of broad gains on Friday, with even a rate hike in Japan unable to halt its march, and a surprise cut in Switzerland highlighting the gap between the Federal Reserve and global peers in interest rate settings.
Euro faced downward pressure on the latest Purchasing Managers Index (PMI) survey by HCOB on Thursday revealing that the Eurozone Manufacturing PMI for March was 45.7, lower than the previous reading of 46.5, and below the consensus forecast of 47.0. However, the Services PMI improved to 51.1 in March from 50.2 in February, surpassing the estimated 50.5. The Eurozone PMI Composite rose to 49.9 in March, compared to the expected 49.7 and the previous reading of 46.3.
UK Retail Sales (Month-on-Month) for February showed no growth, printing a reading of 0.0%, compared to the expected decline of 0.3% and the 3.4% growth recorded in January. However, Core Retail Sales, which exclude auto and motor fuel sales, increased by 0.2% month-on-month, surpassing expectations of a 0.1% decline and maintaining the 3.2% growth seen in January.
BOE Governor Andrew Bailey has reiterated that rate cuts this year are within reason, stressing that all meetings are subject to consideration, with decisions made anew each time. He emphasized the importance of having confidence in the direction of wage growth and stated that waiting for inflation to drop to 2% before contemplating rate cuts is unnecessary. Bailey also expressed optimism about recent economic developments, viewing them as positive news.
The Japanese Yen (JPY) stages a modest recovery. Data released earlier today showed that consumer inflation in Japan remains above the Bank of Japan's (BoJ) 2% target. Moreover, most Japanese firms have agreed to the trade unions' wage rise demands, which is expected to push up inflation in the coming months. This, in turn, supports prospects for further policy tightening by the BoJ and lends some support to the JPY.
The BoJ, however, indicated earlier this week that financial conditions will remain accommodative and fell short of offering any guidance about the pace of policy normalization.
Gold fell toward $2,170 an ounce on Friday, extending losses form the previous session as the dollar strengthened on bets that other major central banks could start cutting interest rates earlier than the Federal Reserve.
WTI crude futures fell to around $80.5 per barrel on Friday, sliding for the third straight session as the possibility of a ceasefire in Gaza, which could allay supply concerns, weighed on oil prices.
Central Banks' Interest Rate Paths and Market Implications Amidst Mixed Signals
Against a backdrop of optimism for US economic growth, the USD Index (DXY) faces difficulty attracting buyers amidst mixed signals concerning the Federal Reserve's (Fed) stance on interest rate cuts. Despite the Fed's announcement last week of its plan to reduce interest rates by 75 basis points (bps) this year, concerns about persistent inflation and stronger-than-expected US macroeconomic data have been raised by several Fed officials. Attention is particularly focused on the upcoming release of the US Personal Consumption and Expenditure (PCE) Price Index, the Fed's preferred inflation measure, set for Friday. Investors are also anticipating other key economic reports, including Durable Goods Orders, the Conference Board's Consumer Confidence Index, and the Richmond Manufacturing Index.
In Europe, Bank of Italy Governor Fabio Panetta indicated that the European Central Bank (ECB) is poised to cut interest rates as inflation trends towards the 2% target. ECB Chief Economist Philip Lane also mentioned the possibility of interest rate reversals, pending a slowdown in wage growth and a return to the 2% inflation target. Meanwhile, the Bank of England (BoE) Governor Andrew Bailey signaled that interest rate reductions this year are a reasonable expectation, following a shift in stance by two BoE policymakers towards maintaining the current borrowing cost at 5.25%, which may impact the British Pound (GBP).
The Japanese Yen (JPY) has seen a slight increase, supported by speculation of market intervention by Japanese authorities and ongoing geopolitical risks in Eastern Europe and the Middle East, enhancing its safe-haven appeal. However, gains are limited due to uncertainties surrounding the Bank of Japan's (BoJ) policy direction and the general bullish sentiment in equity markets, which could restrain the JPY's advance. Conversely, the USD faces downward pressure due to the Fed's anticipated shift towards a less restrictive monetary policy.
In commodities, gold prices have stabilized, with investors awaiting the US PCE price index report for further direction. Oil prices remained stable after a previous session increase, with the market adopting a mixed perspective on the impact of lost Russian refinery capacity due to Ukrainian attacks, though a slightly weaker USD provided some support.
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