Market Roundup
• UK Jan Nationwide HPI (YoY) 1.9%, 1.5% forecast, 1.4% previous
• UK Jan Nationwide HPI (MoM) 0.5%,0.3% forecast, 0.1% previous
• German Dec Import Price Index (MoM) 0.2%,0.3% forecast, 0.5% previous
• German Dec Import Price Index (YoY) -0.7%,-0.6% forecast, -2.1% previous
• German Feb GfK German Consumer Climate 9.9, 9.6 forecast, 9.7 previous
• French Jan Consumer Confidence 104, 102 forecast, 102 previous
• Spanish Dec Retail Sales (YoY) 1.7%,2.2% forecast, 2.5% previous
• Italian Jan Business Confidence 99.9, 99.3 forecast, 99.3 previous
• Italian Jan Consumer Confidence 111.8, 110.5 forecast, 110.8 previous
• Italian Dec PPI (YoY) -2.1%,-2.4% forecast, -2.6% previous
• Italian Dec PPI (MoM) 0.0%,-0.1% forecast, -0.3% previous Looking Ahead - Economic Data (GMT)
• 13:30 US Dec Goods Trade Balance -68.75B forecast, -62.99B previous
• 13:30 US Dec Retail Inventories Ex Auto -0.2% previous
• 13:30 US Wholesale Inventories (MoM) -0.1% previous
• 13:30 US Dec Pending Home Sales (MoM) 0.5, 1.2% previous
• 13:30 US Dec Pending Home Sales Index 108.5 previous
• 13:30 US Fed Interest Rate Decision 1.75% forecast, 1.75% previous
Looking Ahead - Events, Other Releases (GMT)
• 19:00 US FOMC Statement |
Fx Beat
EUR/USD: The euro declined against the U.S. dollar on Wednesday, as strong U.S. consumer confidence data boosted greenback across the board. U.S. consumer confidence exceeded expectations to hit its highest level since August. Traders are now focusing on the Federal Reserve meeting. The market consensus is that the central bank will keep interest rates unchanged at between 1.5% and 1.75%.The euro was down 0.2% versus the U.S. currency at $1.1002, not far from its weakest since early Nov. 29. Immediate resistance can be seen at 1.1023 (5 DMA), an upside break can trigger rise towards 1.1066 (11 DMA).On the downside, immediate support is seen at 1.0955 (Lower BB), a break below could take the pair towards 1.0979 (Nov 29th low).
GBP/USD: Sterling traded near one-week lows against dollar on Wednesday, as investors awaited rate decision by Bank of England. The Bank of England is due to announce its rate decision on Thursday, which has pushed the pound down this month after a series of dovish statements by policymakers led to speculation that an imminent rate cut could be likely. The pound fell 0.1% against the U.S. dollar in late London trade at $1.3012. It was up 0.1% against the euro at 84.50 pence. Immediate resistance can be seen at 1.3060 (9 DMA), an upside break can trigger rise towards 1.3098 (11 DMA).On the downside, immediate support is seen at 1.2971 (Jan 28th low), a break below could take the pair towards 1.2900 (Psychological level).
USD/CHF: The dollar strengthened against the Swiss franc on Wednesday, as investors regained their composure after an outbreak of coronavirus in China. The dollar index was last up 0.1% at 98.08. The greenback is now up 1.8% against a basket of major currencies so far in 2020, ahead of a Federal Reserve meeting later on Wednesday. At (GMT 12:19), Greenback gained 0.23% versus the Swiss franc to 0.9753. Immediate resistance can be seen at 0.9755 (Daily high), an upside break can trigger rise towards 0.9796 (50 DMA).On the downside, immediate support is seen at 0.9713 (5 DMA), a break below could take the pair towards 0.9687 (11 DMA).
USD/JPY: The dollar was little changed against the Japanese yen on Wednesday, as investors awaited U.S. Federal Reserve meeting later on Wednesday. The Fed is not expected to change interest rates when it gives its decision at 1900 GMT, but investors will want to hear whether chairman Jerome Powell retains his cautiously upbeat language. The safe-haven yen was quoted at 109.13 per dollar following a 0.2% loss on Tuesday. Strong resistance can be seen at 109.20 (5 DMA), an upside break can trigger rise towards 109.64 (11 DMA).On the downside, immediate support is seen at 109.00 (Psychological level), a break below could take the pair towards 108.64 (Jan 27th low).
Equities Recap
European shares gained slightly on Wednesday, helped by bank stocks following strong results from Santander, but mounting concerns about the fast-spreading coronavirus kept a lid on gains.
At (GMT 12:25),UK's benchmark FTSE 100 was last trading higher at 0.15 percent, Germany's Dax was up by 0.23 percent, France’s CAC was last up by 0.39 percent
Commodities Recap
Gold edged higher on Wednesday after falling 1% in the previous session, on elevated concerns over an economic impact of the coronavirus outbreak in China, while investors awaited a policy decision from the U.S. Federal Reserve due later in the day.
Spot gold rose 0.2% to $1,568.90 per ounce by 0807 GMT. U.S. gold futures fell 0.2% to $1,567.10.
Oil prices rose for a second day on Wednesday, recouping some losses after a five-day rout, on talk that OPEC could extend oil output cuts if a new coronavirus hurts demand and data showing a decline in U.S. stockpiles.
Brent crude rose 45 cents, or 0.8%, to $59.96 a barrel by 1150 GMT. U.S. crude was up 33 cents, or 0.6%, at $53.81.
Treasuries Recap
U.S.: The U.S. Treasuries gained during Wednesday’s afternoon session ahead of the Federal Reserve’s monetary policy meeting, due to be concluded today by 19:00GMT, followed by a press conference at 19:30GMT. Besides, the country’s gross domestic product (GDP) for the fourth quarter of this year, due to be delivered on January 30 by 13:30GMT, shall pave the way for future direction in the debt market. The yield on the benchmark 10-year Treasury yield lost 1 basis point to 1.630 percent, the super-long 30-year bond yield also edged tad 1 basis point down to 2.084 percent and the yield on the short-term 2-year remained 1-1/2 basis points down at 1.443 percent.
EUR: The German bunds remained mixed during European trading session Wednesday ahead of the country’s unemployment change for the month of January and eurozone’s consumer price inflation (CPI) for the similar period, scheduled to be released on January 30 and 31 by 08:55GMT and 10:00GMT respectively. The German 10-year bond yield, which moves inversely to its price, rose 1 basis point to -0.369 percent, the long-term 30-year yield gained nearly 1-1/2 basis points to 0.143 percent while the yield on short-term 2-year lost 1 basis point to -0.637 percent.
AUS: The Australian bonds plunged during Asian session Wednesday after the country’s consumer price inflation (CPI) for the fourth quarter of this year cheered market investors even as cases of Coronavirus continued to rise in various parts of China. However, financial markets seem to stabilise, with Wall Street showing a rebound from its worst sell off in four months amid a tech stock rally in the overnight session. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, jumped 7-1/2 basis points to 1.036 percent, the yield on the long-term 30-year bond also surged nearly 7-1/2 basis points to 1.636 percent and the yield on short-term 2-year gained a little over 4 basis points to trade at 0.718 percent.
