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Market Roundup
• US PPI (MoM) (Aug) 0.4%, 0.4% forecast, 0.1% previous
•US Initial Jobless Claims 206K, 205K forecast, 207K previous
•US Core PPI (MoM) (Aug) 0.2%, 0.3% forecast, 0.3% previous
•US Continuing Jobless Claims 1,774K, 1,780K forecast, 1,775K previous
•US PPI (YoY) (Aug) 5.4%, 5.3% forecast, 4.8% previous
•US PPI ex. Food/Energy/Transport (MoM) (Aug) 0.3%, 0.4% previous
•US PPI ex. Food/Energy/Transport (YoY) (Aug) 4.7%, 4.7% previous
•US Core PPI (YoY) (Aug) 4.6%, 4.6% forecast, 4.3% previous
•US Jobless Claims 4-Week Avg. 206.00K, 207.50K previous
•Russian Central Bank Reserves (USD) 753.5B, 774.2B previous
•US Atlanta Fed GDPNow (Q3) 4.4%, 4.7% forecast, 4.7% previous
•US Existing Home Sales (Aug) 3.98M, 3.98M forecast, 4.06M previous
•US Existing Home Sales (MoM) (Aug) -2.0%, -1.7% previous
•US Wholesale Inventories (MoM) (Jul) 1.3%, 1.2% forecast, 0.4% previous
•US Wholesale Trade Sales (MoM) (Jul) 0.8%, -2.9% previous
•US Natural Gas Storage 40B, 35B forecast, 30B previous
•US 4-Week Bill Auction 3.775%, 3.700% previous
•US 8-Week Bill Auction 3.845%, 3.750% previous
•US Crude Oil Inventories -0.391M, -1.400M forecast, -4.450M previous
Looking Ahead Economic Data (GMT)
•23:50 Japan BSI Large Manufacturing Conditions (Q3) 2.5 forecast, -1.8 previous
•23:50 Japan PPI (YoY) (Aug) 7.4% forecast, 7.2% previous
•23:50 Japan PPI (MoM) (Aug) 0.0% forecast, 0.1% previous
Looking Ahead Events And Other Releases (GMT)
• No Events Ahead
Currency Forecast
EUR/USD : The euro dipped against the U.S. dollar on Thursday after the ECB delivered an expected 25bp rate hike and annual U.S. headline producer prices came in slightly above forecast. The ECB raised interest rates for the second time this year on Thursday, as expected, aiming to curb inflation fueled by surging energy costs linked to the Iran war.Thursday's hike raises the ECB's benchmark deposit rate to 2.5%, the upper end of the "neutral" range considered by policymakers to neither restrict nor stimulate economic growth.In U.S. data, producer prices increased at a monthly rate of 0.4% in August, in line with expectations, and core rose 0.2%. The annual headline rate increased at a surprisingly quick pace of 5.4%, while the previous month was revised higher.Immediate resistance can be seen at 1.1641(38.2%fib), an upside break can trigger rise towards 1.1677(Aug 28th high).On the downside, immediate support is seen at 1.1612(Daily low), a break below could take the pair towards 1.1585(38.2%fib).
GBP/USD: The British pound eased after U.S. data but remains anchored near recent high as investors awaited a slew of central bank policy decisions including the Bank of England next week. Data on Thursday showed the U.S. producer price index, (PPI) increased in line with expectations in August on a monthly basis amid a rebound in the cost of energy products. Investors will pay close attention to Friday's August consumer price data. UK GDP data for July are due on Friday. Economists polled by Reuters expect the economy to have stalled after growing 0.3% in June, leaving annual growth at 1.2%, up from 1.1% the month before. Meanwhile, Bank of England is not expected to raise rates next week. Markets have priced in only two increases between now and March, a path many analysts view as too aggressive, particularly after Governor Andrew Bailey pushed back against such expectations. Immediate resistance can be seen at 1.3556(SMA 20 ), an upside break can trigger rise towards 1.3655(23.6%fib).On the downside, immediate support is seen at 1.3535(38.2%fib), a break below could take the pair towards1.3483(Sep 2nd low).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Thursday as dollar firmed after hot US U.S. producer prices data.U.S. producer prices increased in line with expectations in August amid a rebound in the cost of energy products. Investors will closely monitor Friday’s U.S. CPI data for further signals on the Federal Reserve’s interest rate outlook. Bank of Canada Governor Tiff Macklem said last week that policymakers were prepared to raise borrowing costs multiple times if inflation remained elevated.Oil prices jumped 4%, with benchmark Brent crude hitting $105 a barrel after the biggest surge in shipping attacks since the Iran war began fueled concerns over supply disruptions. Immediate resistance can be seen at 1.3850(38.2%fib), an upside break can trigger rise towards 1.3917(SMA 20).On the downside, immediate support is seen at 1.3759(Lower BB), a break below could take the pair towards 1.3733(23.6%fib).
USD /JPY :The U.S. dollar edged higher on Thursday as investors digested US producer price index data and awaited next week BOJ policy decision. Echoing that costs were on the rise, a Labor Department report showed that the Producer Price Index (PPI) rose 5.4% in August on an annualized basis, a touch higher than the 5.3% economists polled by Reuters had expected. The BOJ raised interest rates to a 31-year high of 1% in June on the view Japan was on the cusp of durably hitting its 2% inflation target. It kept rates steady in July but signalled a strong chance of a near-term hike on mounting price pressures from the Middle East war and a weak yen.Market expect the BOJ to hike rates to 1.25% next week and then to 1.75% in the second quarter of 2027, earlier than previously thought, amid persistent concerns over broadening price pressures and yen weakness. Immediate resistance can be seen at 154.04(Daily high), an upside break can trigger rise towards 155.10(38.2%fib).On the downside, immediate support is seen at 152.95(Daily low) a break below could take the pair towards 152.00 (Psychological level).
Equities Recap
European stocks dropped to two-month lows on Thursday as markets priced in greater chances of further ECB rate hikes following a rate increase and warnings over rising inflation.
UK's benchmark FTSE 100 closed down by 0.57 percent, Germany's Dax ended down 84 percent, France’s CAC finished the day down by 0.49 percent.
U.S. stocks declined and yields climbed on Thursday as another rise in key inflation data fueled concerns among investors.
Dow Jones closed down by 0.60 % percent, S&P 500 closed down by 0.58% percent, Nasdaq settled down by 0.65% percent.
Commodities Recap
Gold prices fell more than 1% on Thursday as stronger-than-expected U.S. inflation data and rising oil prices boosted expectations for a Federal Reserve rate hike next week.
Spot gold slipped 1% to $4,355.85 per ounce by 01:42 p.m. EDT (1742 GMT). Earlier, bullion fell about 1.7% to touch $4,323.78, its lowest level of the session.U.S. gold futures dropped 1.2% to settle at $4,407.30.
Oil prices surged over 6% on Thursday, with both major benchmarks topping $100 a barrel as a sharp escalation in attacks on shipping raised fears of further supply disruptions.
Brent crude futures settled up $6.42, or 6.34%, at $107.63 a barrel. U.S. oil topped $100 a barrel for the first time since May as West Texas Intermediate crude futures rose $6.43, or 6.69%, to $102.48.
