Market Roundup
• Japan Coincident Indicator (MoM) (Oct) 0.5%, 1.8%forecast, -1.3% previous
• Japan Leading Index (Oct) 110.0,109.3 forecast, 108.6 previous
• Japan Leading Index (MoM) (Oct) 1.8%, 1.6% previous
Looking Ahead Economic Data (GMT)
• 07:00 French Current Account (Oct) -1.60B previous
• 07:00 French Exports (Oct) 51.9B previous
• 07:00 French Imports (Oct) 58.5B previous
• 07:00 French Industrial Production (MoM) (Oct) -0.1% forecast, 0.8% previous
• 07:00 French Trade Balance (Oct) -6.8B forecast, -6.6B previous
•09:00 Italian Retail Sales (MoM) (Oct) 0.4% forecast, -0.5% previous
•09:00 Italian Retail Sales (YoY) (Oct) 0.5% previous
•10:00 EU Employment Change (QoQ) (Q3) 0.1% forecast, 0.1% previous
•10:00 EU Employment Change (YoY) (Q3) 0.5% forecast, 0.6% previous
•10:00 EU Employment Overall (Q3) 170,278.9K forecast, 169,778.7K previous
•10:00 EU GDP (YoY) 1.4% forecast, 1.5% previous
• 10:00 EU GDP (QoQ) (Q3)0.2% forecast, 0.1% previous
Looking Ahead Events And Other Releases (GMT)
•No events Ahead
Currency Forecast
EUR/USD : The euro edged higher on Friday as greenback slipped ahead of key inflation data as investors looked for clues on the Federal Reserve’s policy direction ahead of next week’s meeting. Investors are awaiting the delayed September Personal Consumption Expenditures (PCE) Index, the Federal Reserve’s preferred inflation gauge, due at 1500 GMT.U.S. data on Thursday showed jobless claims fell to 191,000 last week the lowest in over three years and well below the 220,000 forecast.ADP data released on Wednesday showed that private payrolls declined by 32,000 in November, marking the steepest drop in over two and a half years. Immediate resistance can be seen at 1.1674(50%fib), an upside break can trigger rise towards 1.1692(Higher BB).On the downside, immediate support is seen at 1.1583(SMA20), a break below could take the pair towards 1.1570(38.2%fib).
GBP/USD: Sterling firmed on Friday as the U.S. dollar weakened ahead of the release of key inflation data that could influence a deeply divided Federal Reserve. The broad dollar weakness reflects market expectations that the Fed is almost certain to cut interest rates by 25 basis points next Wednesday. The U.S. Personal Consumption Expenditures (PCE) price index, the Fed's preferred inflation gauge, is due later in the day, though the data covers September. Forecasts point to a 0.2% rise in the core measure, leaving the annual rate steady at 2.9%. The U.S. non-farm payrolls report will not be released on Friday. Data on Thursday showed jobless claims fell sharply last week, easing fears of a significant labor market slowdown, though the drop may be influenced by the Thanksgiving holiday.Immediate resistance can be seen at 1.3364(Higher BB), an upside break can trigger rise towards 1.3427(61.8%fib).On the downside, immediate support is seen at 1.3295(50%fib), a break below could take the pair towards 1.3182(SMA 20).
AUD/USD: Australian dollar firmed against dollar on Friday as markets moved to price in a real chance of rate hikes next year, sending bond yield spreads shifting sharply in their favour.Australia’s top central banker said on Wednesday that the economy was likely already operating at its potential growth limit, and warned that if inflation proves more persistent than expected, it could have implications for interest rates.The Reserve Bank of Australia meets for the final time this year next week, and a string of strong readings on inflation, growth, and household spending has eliminated any prospect of a cut to the 3.60% cash rate.All eyes will now turn to the RBA’s statement and press conference to gauge how concerned policymakers are about this unexpected shift in the data.Swaps imply the Reserve Bank of Australia will remain on hold until late next year, but are pricing in a 75% probability for a rate hike by the end of 2026.Immediate resistance can be seen at 0.6619(38.2%fib), an upside break can trigger rise towards 0.6629 (Higher BB).On the downside, immediate support is seen at 0.6557(Oct 2nd low), a break below could take the pair towards 0.6553(38.2%fib)
USD/JPY: The dollar slipped lower on Friday as yen firmed growing BoJ rate-hike bets overshadowed the weak household spending data.. Japanese household spending unexpectedly fell at the fastest pace in nearly two years in October, government data showed Friday, raising concerns about the economic outlook as the Bank of Japan prepares for a possible rate hike as early as this month. On a seasonally adjusted, month-on-month basis, household spending fell 3.5%, sharply missing expectations for a 0.7% increase, the data showed.The indicator will be one of the factors the Bank of Japan evaluates when deciding whether to raise rates in December or wait until next year.On Monday, Kazuo Ueda said the Bank of Japan would weigh the “pros and cons” of a rate hike at its next policy meeting, signaling a strong likelihood of a move to 0.75% later this month. Immediate resistance can be seen at 156.17(Dec 1st high) an upside break can trigger rise towards 157.40 (23.6%fib) .On the downside, immediate support is seen at 155.34 (38.2%fib) a break below could take the pair towards 153.35 (50%fib)
Equities Recap
Japan's Nikkei slipped on Friday, erasing this week's gains, even as other Asian markets remained upbeat, with investors awaiting a U.S. inflation reading that could influence a deeply divided Federal Reserve.
Japan’s, Nikkei 225 was down 1.03%, South Korea’s KOSPI was up 1.78%,Hang Seng was up 0.59%
Commodities Recap
Gold was mostly flat on Friday, as the boost from a weaker dollar was countered by rising Treasury yields, with investors eyeing key inflation data for signals on the Fed’s policy outlook.
Spot gold held its ground at $4,215.92 per ounce, as of 0524 GMT, and was on track for a 0.3% weekly decline.
U.S. gold futures for December delivery edged 0.1% higher to $4,245.70 per ounce.
Oil prices fell 1% on Tuesday as investors balanced fading hopes for a Russia-Ukraine peace deal against concerns over oversupply.
Brent crude futures settled 72 cents lower, or 1.14%, at $62.45 a barrel, while U.S. West Texas Intermediate crude was down 68 cents, or 1.15%, at $58.64 a barrel.
