Market Roundup
•Bank of Canada signals rate cuts will be more gradual
• Bank of Canada governor says Trump's tariff threats add economic uncertainty
• US Core CPI (YoY) (Nov) 3.3%, 3.3% forecast, 3.3% previous
• US Core CPI Index (Nov) 322.66, 322.41 forecast, 321.67 previous
• US CPI (YoY) (Nov) 2.7%, 2.7% forecast, 2.6% previous
• US CPI (MoM) (Nov) 0.3%, 0.3% forecast, 0.2% previous
• US CPI Index, n.s.a. (Nov) 315.49, 315.37 forecast, 315.66 previous
• US CPI Index, s.a. (Nov) 316.44, 315.45 previous
• US CPI, n.s.a (MoM) (Nov) -0.05%, 0.12% previous
• US Real Earnings (MoM) (Nov) 0.3%, -0.1% previous
•Canada BoC Interest Rate Decision 3.25%, 3.25% forecast, 3.75% previous
• US Crude Oil Inventories -1.425M, -1.000M forecast, -5.073M previous
• US Gasoline Inventories 5.086M, -0.200M forecast, 2.362M previous
• US Cleveland CPI (MoM) (Nov) 0.2%, 0.3% previous
Looking Ahead Economic Data (GMT)
• 23:50 Japan Foreign Bonds Buying 922.4B previous
•23:50 Japan Foreign Investments in Japanese Stocks -607.7B previous
• 00:30 Australia Employment Change (Nov) 26.0K forecast, 15.9K previous
•00:30 Australia Full Employment Change (Nov) 9.7K previous
•00:30 Australia Participation Rate (Nov) 67.1% 67.1% previous
•00:30 Australia Unemployment Rate (Nov) 4.2% 4.1% previous
• 00:30 Australia Employment Change (Nov) 26.0K forecast, 15.9K previous
Looking Ahead Events And Other Releases (GMT)
•No events ahead
Currency Summaries
EUR/USD: The euro declined against the dollar on Wednesday after an in-line inflation report reinforced expectations of a Federal Reserve rate cut later this month. The Labor Department's report showed the Consumer Price Index (CPI) rose 0.3% month-on-month in November, matching economists' forecasts. Annually, CPI stood at 2.7%, in line with expectations. Following the data, the likelihood of a 25-basis-point rate cut by the Fed next week rose to 95%, according to CME's FedWatch tool, up from about 85% before the report. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, rose 0.31% to 106.68, with the euro down 0.31% at $1.0493. Immediate resistance can be seen at 1.0605(38.2%fib), an upside break can trigger rise towards 1.0637(30SMA).On the downside, immediate support is seen at 1.0458(23.6%fib), a break below could take the pair towards 1.0417(Lower BB).
GBP/USD: The British pound dropped against the dollar on Wednesday after U.S. CPI report fueled expectations of a 25 basis point rate cut by the U.S. Federal Reserve next week. According to a Labor Department report, the Consumer Price Index (CPI) increased by 0.3% in November, in line with forecasts, while the annual rise was 2.7%, matching expectations. The data increased the likelihood of a quarter-point rate cut by the Fed on December 18 to 96.4%, based on CME's FedWatch tool. Meanwhile, the dollar index, which tracks the greenback against a basket of currencies including the yen and euro, climbed 0.31% to 106.68.Immediate resistance can be seen at 1.2831(23.6% fib), an upside break can trigger rise towards 1.2743 (38.2%fib).On the downside, immediate support is seen at 1.2676(38.2%fib), a break below could take the pair towards 1.2507(23.6%fib).
USD/CAD: The Canadian dollar strengthened against the U.S. dollar on Wednesday after the Bank of Canada cut interest rates by 50 basis points to 3.25%, as anticipated. The central bank signaled that future rate cuts would be more gradual, moving away from previous guidance for continuous easing to support growth. BoC Governor Tiff Macklem also highlighted new uncertainty, pointing to the potential impact of tariffs from U.S. President-elect Donald Trump's administration on Canadian exports. Money markets are pricing in a 60% chance of a 25-basis-point rate cut in January, with a 40% chance of a pause in cuts. Immediate resistance can be seen at 1.4187(23.6% fib), an upside break can trigger rise towards 1.4200 (Higher BB).On the downside, immediate support is seen at 1.4113 (38.2%fib), a break below could take the pair towards 1.4043(50%fib).
USD/JPY: The dollar stabilized against the yen on Wednesday after U.S. inflation data matched expectations, supporting predictions that the Federal Reserve will reduce interest rates next week. The consumer price index increased by 0.3% in November, the biggest rise since April, following four consecutive months of 0.2% gains. This aligned with economists' forecasts. Following the data, the probability of a 25-basis-point rate cut by the Fed on December 18 surged to over 94%, according to CME's FedWatch tool. The dollar rose 0.44%, reaching 152.63 yen. Immediate resistance can be seen at 153.85 (23.6%fib) an upside break can trigger rise towards 154.54 (23.6%fib). On the downside, immediate support is seen at 150.40(38.2%fib) a break below could take the pair towards 150.00 (Psychological level ).
Equities Recap
European stocks recouped earlier losses and closed up on Wednesday, as investors added to bets that the Federal Reserve could lower interest rates later in the month after an in-line U.S. inflation report.
UK's benchmark FTSE 100 closed up by 0.52 percent, Germany's Dax closed up by 0.34 percent, France’s CAC closed up by 0.72 percent.
Wall Street's benchmark S&P 500 index rose on Wednesday and a rally in tech stocks lifted the Nasdaq above the 20,000-point milestone for the first time, after a U.S. inflation report boosted expectations of a Federal Reserve interest rate cut.
Dow Jones closed down by 0.22%percent, S&P 500 closed up by 0.86% percent, Nasdaq closed up by 1.78% percent.
Commodities Recap
Gold gained on Wednesday after an inflation print came in line with expectations, boosting the likelihood of a Federal Reserve rate cut next week, while investors awaited U.S. Producer Price Index (PPI) data for further direction on monetary policy.
Spot gold climbed 0.9% to $2,717.29 per ounce, as of 01:41 p.m. ET (1841 GMT). Spot prices for bullion hit a record high of $2,790.15 an ounce on Oct. 31.U.S. gold futures settled 1.4% higher at $2,756.70.
Gold rose on Wednesday following an inflation report that met expectations, increasing the likelihood of a Federal Reserve rate cut next week. Investors also awaited U.S. Producer Price Index (PPI) data for further insight into the Fed's monetary policy direction.
Spot gold climbed 0.9% to $2,717.29 per ounce, as of 01:41 p.m. ET (1841 GMT). Spot prices for bullion hit a record high of $2,790.15 an ounce on Oct. 31.U.S. gold futures settled 1.4% higher at $2,756.70.
