|   Market Roundups


  |   Market Roundups


America’s Roundup: Dollar dips after Fed statement, Wall Street closes higher, Gold rallies, Oil prices fall over 2% as Fed hikes interest rates-June 16th,2022

Market Roundup

•Fed announces biggest rate hike since 1994

• Powell: does not expect 75 bps to be the norm

• S&P 500 snaps five-session losing streak

•U.S. crude output hits highest level since April 2020

• Gasoline inventories post surprise drawdown

• Canada May Housing Starts 287.3K, 252.6K forecast, 267.3K previous

• US May Import Price Index (MoM) 0.6%, 1.1% forecast,2.9% previous

• US May Retail Sales (MoM) -0.3%,0.2% forecast, 0.9% previous

• US May Core Retail Sales (MoM)  0.5%,0.8% forecast, 0.6% previous

• US May Export Price Index (MoM) 2.8%, 1.3% forecast,0.6% previous

• US Jun NY Empire State Manufacturing Index -1.20, 3.00 forecast,-11.60 previous

• US May Retail Control (MoM) 0.0%, 0.5% forecast, 1.0% previous

• US Apr Retail Inventories Ex Auto 1.7%, 1.7% previous

• US Apr Business Inventories (MoM) 1.2%, 1.2% forecast 2.0% previous

• US Crude Oil Inventories 1.956M,-1.314M forecast, 2.025M previous

• US Gasoline Inventories -0.710M, 1.066M forecast,-0.812M previous

• US Fed Interest Rate Decision 1.75%, 1.50% forecast, - 1.00% previous

Looking Ahead Economic Data(GMT)

•01:30   Australia House Price Index (QoQ) (Q1) 1.4% forecast, 4.7% previous

•01:30   Australia May Participation Rate 66.4%   forecast, 66.3% previous

•01:30   Australia May Full Employment Change 92.4K previous

•01:30   Australia May Unemployment Rate 3.8% forecast, 3.9% previous

•01:30   Australia May Employment Change 25.0K forecast,4.0K previous

Looking Ahead - Events, Other Releases (GMT)

•No significant events

Currency Summaries

EUR/USD: The euro edged higher on Wednesday as dollar dipped after the Federal Reserve raised interest rates by 75 basis points in a historic move to fight inflation and projected a slowing economy and rising unemployment in the months to come. The rate hike was the biggest made by the U.S. central bank since 1994, and was delivered after recent data showed little progress in its inflation battle. Against a basket of currencies, the dollar was 0.50% lower at 104.76, after rising as high as 105.79, its strongest since December 2002, in the immediate aftermath of the Fed decision. With the renewed selling pressure on the dollar, the euro was up 0.36% to $1.0458. Immediate resistance can be seen at 1.0499(38.2%fib),an upside break can trigger rise towards 1.0587(50%fib).On the downside, immediate support is seen at 1.0395(23.6%fib), a break below could take the pair towards 1.0361(Lower BB).

GBP/USD: Sterling recovered from its lowest level against the dollar since March 2020 on Wednesday, a day ahead of the Bank of England's rate decision, but the reprieve could prove temporary due to slowing economic growth and growing post-Brexit tensions. Britain's growth prospects are seen among the weakest for rich countries in 2023, and there is uncertainty over how fast the Bank of England (BoE)   which is expected to raise interest rates again on Thursday - can tighten policy this year to tame inflation without further hurting the economy. The pound, which plunged below $1.20 on Tuesday for the first time since the COVID-19 crash in March 2020, bounced back as more than 1% on Wednesday and was up   at $1.2181.Immediate resistance can be seen at 1.21194(5DMA),an upside break can trigger rise towards 1.2252(50%fib).On the downside, immediate support is seen at 1.2135(38.2%fib), a break below could take the pair towards 1.2002( (23.6%fib).

 USD/CAD: The Canadian dollar strengthened against its U.S. counterpart on Wednesday, with the currency recovering from a one-month low in choppy trading after the Federal Reserve's decision to raise interest rates by three quarters of a percentage point. U.S. stocks clawed back some recent losses, bond yields eased and the safe-haven U.S. dollar lost ground as the Fed announced its biggest rate increase since 1994.In a subsequent news conference, Fed Chair Jerome Powell referenced the rarity of the size of the rate increase. Investors have worried that the Fed would not be able to control inflation without triggering a recession. The Canadian dollar  was trading 0.7% higher at 1.2870 to the greenback, after earlier touching its weakest since May 13 at 1.2995.Immediate resistance can be seen at 1.2908(38.2%fib), an upside break can trigger rise towards 1.2980(Higher BB).On the downside, immediate support is seen at 1.2810(38.2%fib), a break below could take the pair towards 1.2768 (23rd May low).

 USD/JPY: The dollar steadied against dollar on Wednesday as investors cheered the Federal Reserve's decision to raise interest rates by three-fourths of a percentage point, the biggest increase since 1994.Investors seemed relieved that the U.S. central bank had met the market's expectations that it will act aggressively to tame surging inflation, and appeared for now to be comfortable with the Fed's projection that the economy is likely to slow in the next two years . Minutes after the rate hike that was widely predicted by the market, stocks had initially pared gains as investors worried about the prospect of tighter monetary policy tipping the economy into a recession. Strong resistance can be seen at 135.65 (23.6%fib), an upside break can trigger rise towards 136.86(Higher BB).On the downside, immediate support is seen at 132.93 (38.2%fib), a break below could take the pair towards 132.30(14DMA).

Equities Recap

European stocks rallied on Wednesday, with banks leading the gains, after the European Central Bank said its rate-setting Governing Council would hold an unscheduled meeting to discuss the recent sell-off in government bond markets.

UK's benchmark FTSE 100 closed up by  1.20 percent, Germany's Dax ended up by 1.36 percent, France’s CAC finished the day up by 1.35 percent.                

The S&P 500 rallied on Wednesday to snap a five-session losing skid after a policy announcement by the Federal Reserve that raised interest rates to market expectations as the central bank seeks to fight rising inflation without sparking a recession.

Dow Jones closed up by 1.00 percent, S&P 500 closed down by 1.46  percent, Nasdaq settled up   by 2.50 % percent.

Treasuries Recap

U.S. Treasury yields rose in choppy trading on Wednesday after the Federal Reserve raised its target interest rate by three-quarters of a percentage point, as was widely expected.

Benchmark 10-year yields   rose to 3.445% and are holding below Tuesday's top of 3.498%, which was the highest since April 2011.

Commodities Recap

Oil prices fell more than $3 on Wednesday as markets worried about a fall in demand after the Federal Reserve hiked interest rate by three-quarters of a percentage point.

Brent crude futures for August settled down $2.7, or 2.2%, at $118.51 a barrel, having fallen as low as $117.75. U.S. West Texas Intermediate crude for July fell $3.62, or 3.04%, to $115.31 a barrel, after dropping to a low of $114.60.

Gold rallied on Wednesday as the dollar and Treasury yields retreated after the Federal Reserve announced the biggest U.S. interest rate hike since 1994 and flagged economic risks.

Spot gold rose 1.4% to $1,833.42 per ounce by 4:09 p.m. EDT (2009 GMT), while U.S. gold futures settled up 0.3% at $1,819.60 per ounce.

  • Market Data

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.