Market Roundup
• Sweden M3 Money Supply (Aug) 4,717.3B, 4,755.4B previous
• Sweden Household Lending Growth (YoY) (Aug) 0.9% , 0.7% previous
• Sweden Trade Balance (Aug) -5.30B , 5.90B forecast, 6.60B previous
• GfK German Consumer Climate (Oct) -21.2, 22.4 forecast, -21.9 previous
Looking Ahead Economic Data(GMT)
•07:00 Switzerland SNB Interest Rate Decision (Q3) 1.00% forecast, 1.25% previous
•08:00 EUR M3 Money Supply (YoY) (Aug): 2.5% forecast, 2.3% previous
Looking Ahead Events And Other Releases (GMT)
• 09:00 ECB's Elderson Speaks
•09:15 ECB McCaul Speaks
Currency Forecast
EUR/USD: The euro strengthened against the dollar on Thursday as traders anticipated speeches from key Federal Reserve policymakers for insights on the pace of interest rate cuts. Later in the day, Fed Chair Jerome Powell will deliver pre-recorded remarks at a conference in New York, where New York Fed President John Williams will also speak. Weekly U.S. jobless claims data will be closely watched, especially given the Fed's shift in focus toward employment rather than inflation. The U.S. currency rebounded sharply overnight from a more than one-year low against the euro and a 2.5-year low. The euro was up at $1.1152, after pulling back sharply from $1.1118. Immediate resistance is noted at 1.1198 (23.6%fib), with a breakout potentially pushing the pair towards 1.1218 (Higher BB). On the downside, immediate support is at 1.1111 (38.2%fib), a drop below this level could lead the pair towards 1.1049(50%fib).
GBP/USD: The pound recovered slightly from overnight losses against the dollar on Thursday as investors shifted their attention to next month’s British budget and the Bank of England’s interest rate decision scheduled for eight days later. Uncertainty regarding the policy direction of Britain’s newly elected Labour government may be restraining business investment and consumer spending, according to Bank of England Monetary Policy Committee member Megan Greene. Finance Minister Rachel Reeves indicated that some taxes are likely to increase when she presents her first budget on October 30. The expectation of a slower pace of interest rate cuts in the UK compared to other major economies has also given sterling an advantage over other currencies. Immediate resistance can be seen at 1.3417(23.6%fib), an upside break can trigger rise towards 1.3449(Higher BB).On the downside, immediate support is seen at 1.3335(38.2%fib), a break below could take the pair towards 1.3274(50%fib).
AUD/USD: The Australian dollar rebounded sharply on Thursday as risk assets rallied on news of additional Chinese stimulus. Reports indicated that Chinese authorities are considering a $142 billion infusion to support major lenders, following recent measures aimed at revitalizing the economy from its deflationary slump. Data released Thursday showed job vacancies fell by 5.2% in the three months to August, marking the ninth consecutive quarter of decline as labor market demand continued to soften. Meanwhile, the Reserve Bank of Australia, which has ruled out a rate cut this year, cautioned households against taking on excessive debt as interest rates begin to decline. Immediate resistance can be seen at 0.6902(23.6%fib), an upside break can trigger rise towards 0.6927(Higher BB).On the downside, immediate support is seen at 0.6836(38.2%fib), a break below could take the pair towards 0.6814(Sep 24th low).
USD/JPY: The dollar edged higher against the yen on Thursday as it strengthened ahead of remarks from key Federal Reserve policymakers later in the day. Last Wednesday, the Fed implemented a 50-basis-point rate cut, with traders anticipating a 62% chance of another half-percentage-point reduction in November, according to the CME FedWatch Tool. Fed Chair Jerome Powell is set to deliver opening remarks at a conference on Thursday, alongside New York Fed President John Williams and Fed Vice Chair for Supervision Michael Barr.Additionally, U.S. jobless claims data released on Thursday and the core personal consumption expenditure (PCE) indexthe Fed's preferred inflation measureon Friday will be closely monitored for further rate cues. Strong resistance can be seen at 144.73 (38.2%fib), an upside break can trigger rise towards 145.00 (psychological level). On the downside, immediate support is seen at 141.70(23.6%fib), a break below could take the pair towards 140.36(Lower BB).
Equities Recap
Asian stocks rose slightly on Thursday, fueled by optimism over Beijing's aggressive stimulus package aimed at revitalizing the region's largest economy
Hang Seng was up 3.38%,South Korea's KOSPI was up by 2.56%,Japan Nikkei 225 was up by 2.41%
Commodities Recap
Gold edged higher on Thursday, remaining close to record highs amid expectations of another significant U.S. interest rate cut this year. However, gains were limited as investors awaited remarks from key Federal Reserve policymakers
Spot gold was up 0.2% at $2,660.75 per ounce, as of 0601 GMT. Bullion hit a record high of $2,670.43 on Wednesday. U.S. gold futures were steady at $2,684.00.
Oil prices fell on Thursday, reversing earlier gains, as news that top exporter Saudi Arabia had abandoned its crude oil price target in anticipation of increased production weighed on the market.
Brent crude futures were down 55 cents, or 0.75%, to $72.91 a barrel, while U.S. West Texas Intermediate crude fell 55 cents, or 0.79%, to $69.14 per barrel as of 0502 GMT.
