Market Roundup
•Finnish Feb Export Price Index (YoY) -6.9%, -7.6% previous
•Spanish PPI (YoY) -8.2%, -3.8% previous
•Spanish Feb Spanish Consumer Confidence 78.5, 78.6 previous
•UK Mar CBI Distributive Trades Survey 2,-13 forecast, -7 previous
Looking Ahead Economic Data(GMT)
•12:30 US Feb Chicago Fed National Activity -0.30 previous
•12:30 Canada Manufacturing Sales (MoM) 0.2% previous
•14:00 US Feb New Home Sales (MoM) 1.5% previous
•14:00 US Feb New Home Sales 675K forecast,661K previous
•14:00 French 12-Month BTF Auction 3.526% previous
•14:00 French 3-Month BTF Auction 3.796% previous
•14:00 French 6-Month BTF Auction 3.775% previous
•14:30 US Mar Dallas Fed Mfg Business Index -11.3 previous
•15:30 US 3-Month Bill Auction 5.245% previous
•15:30 US 6-Month Bill Auction 5.130% previous
Looking Ahead Events And Other Releases(GMT)
•14:30 US Fed Governor Cook Speaks
Currency Forecast
EUR/USD: The euro edged higher against dollar on Monday as investors digested dovish views from major central banks. The Federal Reserve last week reiterated its projection that it would cut interest rates by 75 basis points by the end of the year, while the Bank of England (BoE) said the economy was heading in the right direction for rate cuts. Meanwhile, the Swiss National Bank (SNB) surprised markets by reducing borrowing costs 25 basis points.Investors expect the Fed, the European Central Bank and the BoE to each deliver only 75 basis points of cuts by the end of this year, in three 25 basis point moves. The euro was last up 0.1% at $1.0818, climbing off a near three-week low. Immediate resistance can be seen at 1.0828(38.2%fib), an upside break can trigger rise towards 1.0906 (23.6%fib).On the downside, immediate support is seen at 1.0800(Psychological level), a break below could take the pair towards 1.0763 (50%fib).
GBP/USD: The pound was little changed on Monday, hovering near its lowest level in a month after investors last week ramped up their bets that the Bank of England will cut interest rates in June The pound dropped about 1% against the dollar last week after the Bank of England held interest rates at 5.25% on Thursday and Bailey said inflation is moving in the right direction for interest rate cuts. Traders now see a roughly 75% chance the BoE cuts rates by June, up from about 35% at the start of last week, according to money market pricing Sterling was flat at $1.2608, not far off Friday's one-month low of $1.2576.Immediate resistance can be seen at 1.2673(38.2%fib), an upside break can trigger rise towards 1.2729 (March 19th high).On the downside, immediate support is seen at 1.2567(50%fib), a break below could take the pair towards 1.2485(61.8%fib).
USD/CHF: The dollar edged higher against the Swiss franc on Monday as greenback received a boost from rising investor expectations of interest rates remaining higher for longer on the back of strong U.S. economic data. Market movement was limited in absence of strong catalysts and as investors were wary that a key U.S. inflation gauge - core personal consumption expenditure (PCE) price index due on Friday could derail the outlook for lower U.S. rates.The PCE index was seen rising 0.3% last month. A stronger outcome would be taken as a setback to hopes for a Federal Reserve rate cut in June. Immediate resistance can be seen at 0.9023(23.6%fib), an upside break can trigger rise towards 0.9050(Nov 13th 2023 high).On the downside, immediate support is seen at 0.8970(Daily low), a break below could take the pair towards 0.8921(38.2%fib).
USD/JPY: The dollar eased against yen on Monday as concerns about potential currency intervention by Japanese authorities kept investors cautious. Japan's top currency diplomat said on Monday the yen's current weakness did not reflect fundamentals, adding to the rhetoric of government officials who have stepped up warnings in recent days over the currency's decline.The yen has dropped despite the Bank of Japan hiking interest rates out of negative territory last week. Traders think rates in Japan will remain low for some time and therefore the big interest rate gap with the U.S. will stay in place, boosting the appeal of the dollar. The Japanese yen was slightly higher on the day and last stood at 151.29 per dollar .Strong resistance can be seen at 151.93 (23.6%fib) an upside break can trigger rise towards 152.39(Higher BB).On the downside, immediate support is seen 150.85(38.2%fib), a break below could take the pair towards 150.12(50%fib)
Equities Recap
European stocks fell marginally at the start of a holiday-shortened week as investors digested recent big gains spurred by dovish views from major central banks.
At (GMT 12:16 ),UK's benchmark FTSE 100 was last trading down at 0.49 percent, Germany's Dax was down by 0.02 percent, France’s CAC finished was down by 0.37 percent.
Commodities Recap
Gold prices firmed on Monday as investors positioned for key economic data and comments from Federal Reserve officials this week for further confirmation on the interest rate cuts signalled by the U.S. central bank.
Spot gold was up 0.3% at $2,171.42 per ounce, as of 1116 GMT, while silver rose 0.3% to $24.73.U.S. gold futures climbed 0.6% to $2,172.50.
Oil benchmark Brent hovered close to $86 a barrel on Monday as hostilities intensified between Russia and Ukraine and in the Middle East.
Brent crude futures climbed 40 cents to $85.83 a barrel by 1124 GMT while U.S. crude futures also gained 40 cents to $81.03.
