|   Market Roundups


  |   Market Roundups


America’s Roundup: U.S. dollar advances as markets brace for hefty Fed rate hike,Wall Street ends choppy session higher, Gold falls, Oil edges up as supply woes outweigh demand and rate hike worries-September 20th,2022

Market Roundup

• All eyes on Fed policy decision on Wednesday

•Traders price in small chance of 100 bps rate hike

•U.S. 10-year Treasury yields hit highest since 2011

•US indexes up: Dow 0.64%, S&P 0.69%, Nasdaq 0.76%

•Canada Aug IPPI (YoY)  10.6%,11.9% previous

•Canada Aug RMPI (MoM) -4.2%,3.2%  forecast, -7.4% previous

•Canada Aug IPPI (MoM)  -1.2%,0.2% forecast,-2.1% previous

•Canada Aug RMPI (YoY) 17.6%, 19.1% previous

• French 12-Month BTF Auction 1.798%,1.450% previous

• French 3-Month BTF Auction 0.686%,0.648% previous

• French 6-Month BTF Auction 0.890%,0.747% previous

•US Sep NAHB Housing Market Index 46  , 47 forecast,  49 previous

•US 3-Month Bill Auction 3.270% , 3.075% previous

•US  6-Month Bill Auction  3.780%, 3.465% previous

Looking Ahead - Economic Data (GMT)

• 23:30 Japan Aug CPI, n.s.a (MoM)  0.5% previous

• 23:30 Japan Aug National Core CPI (YoY)  2.7%  forecast, 2.4% previous

• 23:30 Japan Aug National CPI (YoY)  2.6% previous

•01:15 China PBoC Loan Prime Rate 3.65% forecast, 3.65% previous

Looking Ahead - Events, Other Releases (GMT)

•01:30   Australia RBA Meeting Minutes

Currency Summaries


EUR/USD: The euro was little changed against dollar on Monday ahead of a slew of central bank meetings this week led by the Federal Reserve, which is likely to raise interest rates by another 75 basis points (bps). Fed funds futures have priced in an 81% chance of a 75 bps rate hike this week and a 19% probability of a 100-increase at the conclusion of the U.S. central bank's two-day policy meeting. The dollar index , which measures the currency against six counterparts, was up 0.1% at 109.62, not far from 20-year high of 110.79 hit on Sept. 7. The euro was little changed against the dollar at $1.0025. Immediate resistance can be seen at 1.0046(30DMA), an upside break can trigger rise towards 1.0094 (38.2%fib).On the downside, immediate support is seen at 0.9956 (23.6%fib), a break below could take the pair towards 0.9902(Lower BB).

GBP/USD: Sterling edged higher against a robust dollar on Monday as the dollar gave up some gains ahead of a much-anticipated monetary policy decision by the U.S. Federal Reserve and several other central banks this week. Currency trade was generally subdued with London markets closed for the Queen's funeral. While the Bank of England is expected to raise rates by at least 50 basis points (bps) this week, the prospect of further tightening has failed to shore up the pound. The Federal Reserve is also meeting this week and expectations for an even bigger hike of at least 75 bps has bolstered the dollar. The sterling was up 0.08 percent against the dollar at  1.1438, Immediate resistance can be seen at 1.1462(5DMA), an upside break can trigger rise towards 1.1501 (38.2%fib).On the downside, immediate support is seen at 1.1364 (23.6%fib), a break below could take the pair towards 1.1283 (Lower BB).

USD/CAD : The Canadian dollar was little changed against the greenback on Monday, clawing back its earlier decline, as investors adjusted bets on how much the Federal Reserve could raise interest rates this week and awaited domestic inflation data. Money markets have fully priced the likelihood the Fed will deliver a 75-basis-point hike after the end of a two-day policy meeting on Wednesday, and about a 20% chance of an even larger move of 100 basis points. Canadian inflation data for August, due on Tuesday, could help guide expectations for additional tightening by the Bank of Canada. The Canadian dollar was trading nearly unchanged at 1.3260 per U.S. dollar, after touching its weakest intraday level since November 2020 at 1.3344. Immediate resistance can be seen at 1.3303 (Higher BB), an upside break can trigger rise towards 1.3358 (23.6%fib).On the downside, immediate support is seen at 1.3182 (50%fib), a break below could take the pair towards 1.3159(9DMA).

USD/JPY: The dollar was little changed against the Japanese yen on Monday as investors prepared for a packed week of central bank meetings which will see borrowing costs rise globally, with the chance of a super-sized hike in the United States. Markets are fully priced for a rise in interest rates of 75 basis points from the Federal Reserve, with futures showing a 20% chance of a full percentage point.They also indicate a real chance that rates could hit 4.5% as the Fed is forced to tip the economy into recession to subdue inflation. The dollar last trading at 143.20 yen , having backed away from the recent 24-year peak of 144.99 in the face of increasingly strident intervention warnings from Japanese policymakers. Strong resistance can be seen at 143.44 (5DMA), an upside break can trigger rise towards 144.77(23.6%fib).On the downside, immediate support is seen at 142.01 (38.2%fib), a break below could take the pair towards 140.96 (21DMA).

Equities Recap

European markets staged a recovery past mid afternoon on Monday but still ended the session mostly lower.

 UK's benchmark FTSE 100 closed down  by 0.62 percent, Germany's Dax ended up  by 0.49 percent, France’s CAC finished the day down by 0.26 percent.

Wall Street's main indexes ended a seesaw session higher on Monday, as investors turned their attention to this week's policy meeting at the Federal Reserve and how aggressively it will hike interest rates.

Dow Jones closed up  by  0.64% percent, S&P 500 closed up by 0.69% percent, Nasdaq settled up by 0.76%  percent.

Treasuries Recap

Benchmark 10-year U.S. Treasury yields rose to their highest in over 11 years on Monday as investors braced for the Federal Reserve's policy decision on Wednesday, where it is expected to deliver another large interest rate hike.

The 10-year yield, the most significant interest rate benchmark globally, rose as much as six basis points to 3.508%, the highest since April 2011.  

Commodities Recap

Gold prices weakened on Monday, back toward a 29-month low hit on Friday, as the dollar and Treasury yields firmed on expectations the U.S. Federal Reserve will deliver a steep interest rate hike when it meets this week.

Spot gold was down 0.3% at $1,670.72 an ounce by 1:48 p.m. ET (1748 GMT), holding above its lowest since April 2020 hit on Friday. U.S. gold futures  settled 0.3% lower at $1,678.20.

il prices edged slightly higher in volatile trading on Monday, as worries of tight supplies outweighed fears that global demand could slow due to a strong U.S. dollar and possible large increases to interest rates.

Brent crude for November rose 65 cents, or 0.7%, to $92 a barrel, while U.S. West Texas Intermediate (WTI) for October was up 62 cents to $85.73 per barrel, or 0.7% percent.

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