Market Roundup
•US Aug CPI Index, n.s.a 273.57,273.80 forecast, 273.00 previous
•US Aug CPI, n.s.a (MoM ) 0.21% ,0.48% previous
•Canada Jul Manufacturing Sales (MoM) -1.5%,-1.2% forecast, 2.1% previous
•US Aug Core CPI Index 279.34, 279.05 previous
•US Aug Core CPI (MoM) 0.1%,0.3% forecast, 0.3% previous
•US Aug CPI (MoM ) 0.3%,0.4% forecast, 0.5% previous
•US Aug Core CPI (YoY) 4.0%, 4.2% forecast, 4.3% previous
•US Real Earnings (MoM) 0.3%, -0.1% previous
•US Redbook (YoY) 15.3%,16.5% previous
•US Aug Cleveland CPI (MoM) 0.3%, 0.3% previous
Looking Ahead –Economic Data (GMT)
•23:50 Australia HIA New Home Sales (MoM) -20.5% previous
•01:30 China Aug House Prices (YoY) 4.6% previous
•02:00 Chinese Aug Industrial Production YTD (YoY) 14.4% previous
•02:00 Chinese Aug Industrial Production (YoY) 5.8% forecast, 6.4% previous
•02:00 Chinese Aug Retail Sales (YoY) 7.0% forecast, 8.5% previous
•02:00 Chinese Aug Fixed Asset Investment (YoY) 9.0% forecast, 10.3% previous
Looking Ahead - Events, Other Releases (GMT)
•No significant events
Currency Summaries
EUR/USD: The euro edged higher against dollar on Tuesday after data showed a less-than-expected rise in U.S. inflation last month, creating uncertainty about the timing of the Federal Reserve’s tapering of asset purchases. Data on Tuesday showing the U.S. consumer price index, excluding the volatile food and energy components, edged up just 0.1% last month has raised doubts about tapering this year. The dollar index, which measures the greenback against six major rivals, fell up to 0.4% as data showed underlying U.S. consumer prices rose at their slowest pace in six months, creating uncertainty about the Fed's stance on stimulus tapering. Immediate resistance can be seen at 1.1831 (23.6%fib), an upside break can trigger rise towards 1.1865(10th Sep high).On the downside, immediate support is seen at 1.1800(38.2%fib), a break below could take the pair towards 1.1789 (21DMA).
GBP/USD: Sterling reversed course from earlier gains against the dollar on Tuesday as economic uncertainties and the increasing likelihood of a corporate tax rate hike dampened investor sentiment. Optimism faded throughout the session, reversing an initial rally following the Labor Department’s consumer price index report. The Labor Department said on Tuesday its Consumer Price Index (CPI) was up just 0.1% last month, compared to an expected increase of 0.3%. Immediate resistance can be seen at 1.3823 (38.2%fib),an upside break can trigger rise towards 1.3886 (23.6%fib).On the downside, immediate support is seen at 1.3778(30DMA), a break below could take the pair towards 1.3772(50%fib).
USD/CAD: The Canadian dollar weakened against its U.S. counterpart on Tuesday as Wall Street and industrial metal prices fell. Wall Street lost ground as investors looked past lower-than-expected inflation data, focusing instead on economic uncertainties and growing chances of a corporate tax hike. Oil settled one cent higher at $70.46 a barrel but industrial metals fell, weighed down by concerns over the property market in top consumer China. The loonie was trading 0.2% lower at 1.2675 to the greenback, after trading in a range of 1.2600 to 1.2684. Immediate resistance can be seen at 1.2689(Sep 9th high), an upside break can trigger rise towards 1.2781(23.6%fib).On the downside, immediate support is seen at 1.2685 (38.2%fib), a break below could take the pair towards 1.2633 (11DMA).
USD/JPY: The dollar declined against yen on Tuesday after data showed U.S. inflation rose by less than expected, raising renewed questions on when the U.S. central bank will begin tapering its asset purchases. The data showed the rise in U.S. consumer prices slowed to 0.3% in August from 0.5% in July, below the 0.4% a Reuters poll had projected. The inflation data could reinforce the view that the Fed may go slow on unwinding economic support measures and keep interest rates low. The dollar fell 0.4% to 109.61 versus the Japanese yen.Strong resistance can be seen at 109.83(38.2%fib), an upside break can trigger rise towards 110.17(23.6%fib).On the downside, immediate support is seen at 109.59(50%fib), a break below could take the pair towards 109.49(Lower BB).
Equities Recap
European shares edged higher at the close after seesawing for most of the session on Monday, as traders swung their attention to the extra injections of support they now expect major central banks to provide following the coronavirus outbreak.
UK's benchmark FTSE 100 closed down by 0.49 percent, Germany's Dax ended up by 0.14 percent, France’s CAC finished the day down by 0.36 percent.
U.S. stock futures rose on Tuesday as data showed underlying consumer prices increased at their slowest pace in six months in August, lending credence to the Federal Reserve’s view that high levels of inflation were transitory.
Dow Jones closed down by 0.84 percent, S&P 500 closed down by 0.57 percent, Nasdaq settled down by 0.43% percent.
Commodities Recap
Gold hit a one-week high on Tuesday, as the dollar retreated after a slower-than-expected rise in U.S. inflation led to uncertainty over the U.S. Federal Reserve’s timeline to taper monetary stimulus.
Spot gold rose 0.6% to $1,803.69 per ounce by 1835 GMT, and U.S. gold futures settled up 0.7% at $1,807.10 per ounce.
Oil prices ended largely unchanged on Tuesday as tropical storm Nicholas brought heavy rain and power outages in Texas but caused less damage to U.S. energy infrastructure than Hurricane Ida caused earlier this month.
Brent crude settled up 9cents to$73.60 a barrel after hitting a session high of $74.28. U.S. West Texas Intermediate (WTI) crude settled up 1 cent, at $70.46, after touching a high of $71.22.
