Market Roundup
•UK Jan CPI (YoY) 0.7%,0.6% forecast, 0.6% previous
•UK Jan CPI (MoM) -0.2%,-0.4% forecast, 0.3% previous
•UK Jan CPI, n.s.a 109.00 , 109.20 previous
•UK Jan PPI Output (MoM) 0.4%,0.2% forecast, 0.3% previous
•UK Jan Core CPI (YoY) 1.4%,1.3% forecast, 1.4% previous
•UK Jan Core CPI MoM (MoM) -0.5%,-0.7% forecast, 0.3% previous
•German Jan Car Registration (YoY) -31.1%,9.9% previous
•German Jan Car Registration (MoM) -45.5%, 7.3% previous
•French Jan Car Registration (MoM) -32.2%,47.8% previous
•UK Jan Car Registration (MoM) -32.0%,16.6% previous
•UK Jan Core PPI Output (MoM) 0.3%,0.1% previous
•UK Jan PPI Input (MoM) 0.7%,0.5%forecast, 0.8% previous
•EU Dec Construction Output (MoM) -3.67%,1.41% previous
Looking Ahead - Economic Data (GMT)
•13:30 US Jan Core PPI (MoM) 0.2%forecast ,0.1% previous
•13:30 Canada Jan CPI (YoY) 0.9% forecast,0.7% previous
•13:30 US Jan Retail Sales (YoY) 2.90% previous
•13:30 Canada CPI (MoM) 0.4%forecast, -0.2% previous
•13:30 Canada Common CPI (YoY) 1.5% previous
•13:30 Canada Trimmed CPI (YoY) 1.6% previous
•13:30 US Jan PPI (MoM) 0.4%,0.3% previous
•13:30 US Jan Core CPI (MoM) -0.4% previous
•13:30 US Jan Core CPI (YoY) 1.4% forecast, 1.5% previous
•13:30 US Jan Core Retail Sales (MoM) 1.0% forecast,-1.4% previous
•13:30 US Jan Retail Sales (MoM) 1.1%forecast, -0.7% previous
•13:30 US Jan Retail Sales Ex Gas/Autos (MoM) -2.1% previous
•13:30 US Jan Core PPI (YoY) 1.1%forecast, 1.2% previous
•13:55 US Redbook (YoY) 0.7% previous
•13:55 US Redbook (MoM) -2.5% previous
•14:15 US Jan Industrial Production (MoM) 0.5%,1.6% previous
•14:15 US Jan Capacity Utilization Rate 74.8%,74.5% previous
•14:15 US Industrial Production (YoY) -3.58% previous
•14:15 US Jan Manufacturing Production (MoM) 0.7%forecast, 0.9% previous
•15:00 US Dec Business Inventories (MoM) 0.5%forecast,0.5% previous
•15:00 US Feb NAHB Housing Market Index 83 forecast, 83 previous
Looking Ahead - Economic events and other releases (GMT)
•14:00 US FOMC Member Barkin Speaks
•19:00 US FOMC Meeting Minutes
Fx Beat
EUR/USD: The euro declined against dollar on Wednesday ahead of monthly retail sales data and the release of minutes from the U.S Federal Reserve’s January meeting. Retail sales are estimated to rise 1.1% in January, helped by the disbursal of another round of pandemic relief checks to households at the beginning of the month. Investors are also expecting central banks to keep monetary policy loose in the short term, and the Fed minutes, which will be released later in the day, are likely to back those views. Immediate resistance can be seen at 1.2106(25EMA), an upside break can trigger rise towards 1.2140(50%fib).On the downside, immediate support is seen at 1.2065 (38.2%fib), a break below could take the pair towards 1.2000 (Psychological level).
GBP/USD: The British pound held near recent high against dollar on Wednesday as investors bet Britain'sCOVID-19 vaccinations would help its coronavirus-battered economy reopen quickly and recover from its worst hit in 300years. Britain has vaccinated 15.6 million people with a first dose against COVID-19 so far, and bets that its tattered economy could reopen quickly bolstered the pound.Expectations of large fiscal stimulus in the United States have also sent the pound to its highest in two-and-a-half years against the dollar. Immediate resistance can be seen at 1.3909(23.6%fib), an upside break can trigger rise towards 1.4000(Psychological level).On the downside, immediate support is seen at 1.3843 (Daily low), a break below could take the pair towards 1.3895 (38.2%fib).
USD/CHF: The dollar strengthened against the Swiss franc on Wednesday as a surge in U.S. Treasury yields boosted demand for greenback. Benchmark ten-year Treasury yields made a fresh one-year high to trade near pre-pandemic levels, as vaccine progress and encouraging economic data begin to drive an intense investor focus on an inflation pulse now widely expected. The gap between ten-year and two-year U.S. yields hit its widest point in nearly three years in anticipation of short-term rates going nowhere. Investors, for now, do not think central banks will do anything about it anytime soon, and minutes later on Wednesday from the U.S Federal Reserve’s January meeting are expected to reinforce that view. Immediate resistance can be seen at 0.8974 (23.6%fib), an upside break can trigger rise towards 0.9000 (Psychological level).On the downside, immediate support is seen at 0.8932 (38.2%fib), a break below could take the pair towards 0.8897(50%fib).
USD/JPY: The dollar rose against the yen, as U.S. bond yields jumped on the prospects of further economic recovery and a possible acceleration in inflation. Soaring U.S. bond yields boosted the dollar, with the 10-year yield rising as high as 1.333% from around 1.20% at the end of last week.The dollar’s index against six other major currencies jumped from Tuesday’s three-week low of 90.117 to last stand at 90.739.The yen, which is sensitive to U.S. yields, reacted the most with the dollar jumping to as high as 106.225 yen in Asian trade, its highest since September, before retreating to 105.89 yen. Strong resistance can be seen at 106.15 (38.2%fib), an upside break can trigger rise towards 106.52(23.6%fib).On the downside, immediate support is seen at 105.87 (50%fib), a break below could take the pair towards 105.60 (61.8%fib).
Equities Recap
European shares retreated from near one-year highs on Wednesday as concerns about a possible rise in inflation tempered optimism around a vaccine-led global economic recovery, while Kering tumbled after sales at its Gucci brand fell more than expected.
At (GMT 13:00),UK's benchmark FTSE 100 was last trading down at 0.16 percent, Germany's Dax was down by 0.55 percent, France’s CAC was last down by 0.07 percent.
Commodities Recap
Gold slipped to its lowest in over two months on Wednesday, as surging U.S. Treasury yields and a firmer dollar continued to take a toll on the non-yielding metal's appeal.
Spot gold was down 0.5% to $1,785.20 per ounce at 0919 GMT. The metal dropped 1.3% in the previous session and hit its lowest since Dec. 1 at $1,782.90 earlier on Wednesday.
Oil prices rose on Wednesday, underpinned by a major supply disruption in the southern United States this week where a winter storm hit Texas.
Benchmark Brent crude gained 91 cents, or 1.4%, to $64.26 a barrel at 1209 GMT, its highest level since January 2020.
U.S. West Texas Intermediate (WTI) crude rose 68 cents, or 1.1%, to $60.73 a barrel.
