Europe Roundup: Sterling extends gains post BoE rate decision, European shares slide, Gold inches down, Oil rises as WHO declares emergency but opposes travel ban-January 31st,2020

Market Roundup

• French Dec Consumer Spending (MoM) -0.3%,-0.1% forecast,0.7% previous

• French Dec CPI (MoM)  -0.4%,0.4% previous    

• French CPI (YoY) 1.5%, 1.5% previous  
 
• French HICP (YoY) 1.6% , 1.7% forecast 1.6% previous

• Spanish CPI (YoY) 1.1%,1.0% forecast, 0.8% previous

• Spanish GDP (YoY) (Q4) 1.8%,1.7% forecast,1.9% previous    

• Spanish GDP (QoQ) (Q4) 0.5%,0.4% forecast, 0.4% previous  
 
• Italian GDP (YoY) (Q4) 0.0%,0.3% forecast, 0.5% previous    

• EU Core CPI (YoY) 1.1%,1.2% forecast, 1.3% previous    

• EU Jan CPI (YoY)  1.4%,1.4% forecast, 1.3% previous    

• EU GDP (YoY) 1.0%,1.1% forecast, 1.2% previous

• EU GDP (QoQ)  0.1%,0.2% forecast, 0.2%    previous

• EU Jan HICP ex Energy & Food (YoY) 1.3%,1.4% forecast, 1.4% previous

Looking Ahead - Events, Other Releases (GMT)    

• 13:30 Brazil Budget Balance -53.200B previous 
   
• 13:30 US Dec Core PCE Price Index (MoM) 0.1% forecast,  0.1% previous

• 13:30 US Dec Core PCE Price Index (YoY) 1.6% forecast 1.6% previous

• 13:30 US Employment Benefits (QoQ) (Q4) 0.60% previous

• 13:30 US Employment Cost Index (QoQ) (Q4) 0.7%forecast, 0.7% previous    

•13:30 US Employment Wages (QoQ) (Q4) 0.90% previous    

• 13:30 US Dec PCE price index (MoM) 0.2% previous

• 13:30 Canada Nov GDP (MoM)  0.1%,-0.1% previous

• 14:45 US Jan Chicago PMI 48.8, 48.2 previous

• 15:00 US Jan Michigan 5-Year Inflation Expectations 2.20% previous

• 15:00 US Michigan Consumer Expectations   88.9 previous

• 15:00 US Jan Michigan Consumer Sentiment 99.1, 99.3 previous

• 16:00 Canada Nov Budget Balance -3.25B previous

• 16:00 Canada Nov Budget Balance (YoY) -9.05B    previous

• 17:00 US Dec Dallas Fed PCE 2.20% previous    

Looking Ahead - Events, Other Releases (GMT)    

• No significant events  
       
Fx Beat

EUR/USD: The euro strengthened against the U.S. dollar on Friday,   as investors clutched at hopes that China could contain the coronavirus. The World Health Organization on Thursday declared a global emergency as the virus spread to more countries. The euro was up 0.11% versus the U.S. currency at $1.1043.Immediate resistance can be seen at 1.1068 (50 DMA), an upside break can trigger rise towards 1.1090 (100 DMA).On the downside, immediate support is seen at 1.0990 (Lower BB), a break below could take the pair towards 1.0938  (Oct 8th low).

GBP/USD: Sterling rose against dollar on Friday for a second consecutive day following the Bank of England's decision to keep interest rates steady on signs of a post-election pick-up in growth.But analysts said the rally may be short lived. The United Kingdom exits the European Union at 2300 GMT on Friday and faces negotiations on reaching a new trade and future relationship deal with the bloc by the end of 2020 something the EU has said will not be easy. Immediate resistance can be seen at 1.3159 (Higher BB), an upside break can trigger rise towards 1.3200 (Psychological level).On the downside, immediate support is seen at 1.3070 (11 DMA), a break below could take the pair towards 1.3000 (Psychological level).

USD/CHF: The dollar declined against the Swiss franc on Friday, as concern epidemic worries in China stoked demand for the perceived security of safe-haven assets like Swiss franc. At (GMT 12:19), Greenback dipped 0.28% versus the Swiss franc to 0.9704. Immediate resistance can be seen at 0.9714 (30 DMA), an upside break can trigger rise towards 0.9784 (50 DMA).On the downside, immediate support is seen at 0.9680 (Daily low), a break below could take the pair towards 0.9600 (Psychological level).

USD/JPY: The dollar declined against the Japanese yen on Friday, as investors switched to the shelter of the Japanese yen as the death toll from China’s coronavirus outbreak hit 170. Safe-haven Japanese yen gained, as the number of people infected by the virus in a fast-spreading health crisis surpassed 8,100 people globally, more than the total from the 2002-2003 SARS epidemic. The yen strengthened 0.22% at 108.78 per dollar. Strong resistance can be seen at 109.20 (50 DMA), an upside break can trigger rise towards 109.51 (11 DMA).On the downside, immediate support is seen at 108.72 (100 DMA), a break below could take the pair towards 108.13 (Lower BB). 

Equities Recap

European shares dipped on Friday as investors also fretting over the economic impact of a virus epidemic in China that has now claimed 170 lives.

 At (GMT 12:55),UK's benchmark FTSE 100 was last trading lower at 0.65 percent, Germany's Dax was down by 0.30 percent, France’s CAC was last down by 0.39 percent.

Commodities Recap

Gold prices eased on Friday after the World Health Organization (WHO) said measures taken by China could control the coronavirus outbreak and surveys showed signs of stabilisation in the world’s second-largest economy.

Spot gold fell 0.1% to $1,572.96 per ounce by 0646 GMT, while U.S. gold futures declined 0.7% to $1,578.30.

Oil prices rose on Friday but were still set for a fourth consecutive weekly loss, as markets attempted to assess the economic damage of the new coronavirus that has spread from China to around 20 countries, killing more than 200 people.

Brent crude  was up 20 cents at $58.49 a barrel by 1208 GMT but still down 3.6% on the week.

U.S. West Texas Intermediate (WTI)  rose by 24 cents to $52.38 a barrel, but remained down 3.3% on the week.

Treasuries Recap

U.S.: The U.S. Treasuries remained nearly flat during Friday’s afternoon session amid a muted trading session that witnessed data of little economic significance ahead of the country’s host of 2-tier economic data, due for release through the day. The yield on the benchmark 10-year Treasury yield hovered around 1.560 percent, the super-long 30-year bond yield remained flat at 2.027 percent and the yield on the short-term 2-year remained steady at 1.389 percent.

EUR: The German bunds gained during European trading session Friday even as eurozone’s consumer price inflation (CPI) for the month of January rose, meeting market expectations, while the country’s retail sales disappointed market sentiments, slumping, far from the previous reading in December. The German 10-year bond yield, which move inversely to its price, slipped nearly 1 basis point to -0.414 percent, the long-term 30-year yield also lost nearly 1 basis point to 0.087 percent and the yield on short-term 2-year too suffered tad nearly 1 basis point to -0.664 percent.

AUS: The Australian bonds remained tad higher during Asian session of the last trading day of the week Friday, after the World Health Organization (WHO) declared the coronavirus crisis a “public health emergency of international concern”. The United States’ 3m10y yield curve inverted for the first time since October last year, with China reporting the highest jump in infected and death cases intraday. The yield on Australia’s benchmark 10-year note, which moves inversely to its price, edged tad 1/2 basis point down to 0.960 percent, the yield on the long-term 30-year bond suffered nearly 1-1/2 basis points to 1.558 percent and the yield on short-term 2-year lost 1 basis point to trade at 0.653 percent.