Market Roundup
• Japan PPI (MoM) (May) 0.9%, 0.5% forecast, 2.8% previous
•Japan PPI (YoY) (May) 6.3%, 5.6% forecast, 5.3% previous
•Australia Building Approvals (MoM) (Apr) -3.4%, -3.4% forecast, -10.5% previous
•China CPI (MoM) (May) -0.1%, -0.2% forecast, 0.3% previous
•China CPI (YoY) (May) 1.2%, 1.3% forecast, 1.2% previous
•China PPI (YoY) (May) 3.9%, 3.9% forecast, 2.8% previous
•Australia Building Approvals (YoY) (Apr) 10.20%, 10.20% forecast, 9.00% previous
•Australia Private House Approvals (Apr) -1.0%, -1.0% forecast, 0.5% previous
Looking Ahead Economic Data (GMT)
• 09:00 Italian Industrial Production (YoY) (Apr) 1.5% previous
•09:00 Italian Industrial Production (MoM) (Apr) 0.0%forecast, 0.7% previous
•09:00 Greek CPI (YoY) (May) 5.4% previous
•10:00 Greek Industrial Production (YoY) (Apr) 8.3% previous
•10:00 Greek HICP (YoY) (May) 4.6% previous
Looking Ahead Events And Other Releases (GMT)
• No Events Ahead
Currency Summaries
EUR/USD : The euro initially dipped but recovered some ground on Wednesday as markets remained on edge over the latest clash between the U.S. and Iran, while investors awaited key U.S. inflation data for clues on the Federal Reserve's rate path.The U.S. military struck Iranian targets after President Donald Trump vowed on Tuesday to respond to the downing of an Apache attack helicopter, a fresh escalation that threatens to unravel a fragile ceasefire between Washington and Tehran.Iran's Revolutionary Guards said they had carried out attacks against a U.S. base in Jordan and 21 other targets in the Gulf on Wednesday in retaliation for American strikes around the Strait of Hormuz, Iranian media reported. The euro was up 0.01% at $1.1544. Immediate resistance can be seen at 1.1633(SMA20), an upside break can trigger rise towards 1.1673(50%fib).On the downside, immediate support is seen at 1.1505(61.8%fib), a break below could take the pair towards 1.1481(Lower BB).
GBP/USD: The pound edged higher on Wednesday as markets stayed on edge over escalating U.S.–Iran tensions. The U.S. military struck Iranian targets after President Donald Trump vowed to respond to the downing of a U.S. Apache helicopter, further straining an already fragile ceasefire between Washington and Tehran.Iran’s Revolutionary Guards said they retaliated with strikes on a U.S. base in Jordan and multiple targets across the Gulf, while warning of further action if Israeli operations against Hezbollah in Lebanon continue. Israel’s refusal to halt its campaign has complicated efforts to extend the ceasefire into a more durable agreement. Oil prices rose around 1%, reinforcing expectations that interest rates may remain higher for longer.Immediate resistance can be seen at 1.3463(SMA 20), an upside break can trigger rise towards 1.3526(50%fib).On the downside, immediate support is seen at 1.3317(50%fib), a break below could take the pair towards1.3265(Lower BB).
AUD/USD: Australian dollar dipped on as deteriorating U.S.-Iran relations dampened risk appetite.The market semtiment remained cautious after fresh hostilities threatened to unravel the tentative truce. U.S. President Donald Trump said Iran had shot down a U.S. Apache helicopter in the Strait of Hormuz and vowed to respond. Investors were wary as diplomacy has so far failed to produce a peace deal or reopen the Strait of Hormuz, a vital artery for global oil supplies. On the data front, China’s producer prices hit their highest since July 2022 in May, while consumer inflation stayed elevated amid higher global energy costs.The producer price index (PPI) rose 3.9% from the previous year, National Bureau of Statistics (NBS) data showed on Wednesday. Consumer prices in May rose 1.2% from a year earlier mainly on rising gasoline. Immediate resistance can be seen at 0.7170(38.2%fib), an upside break can trigger rise towards 0.7189(SMA 20).On the downside, immediate support is seen at 0.7027(50%fib), a break below could take the pair towards 0.7000(50%fib).
USD/JPY: The dollar edged higher slightly on Wednesday as economic risks due to Mideast tensions undermine the yen.So far, there has been no evidence of Japanese FX intervention, with market participants noting that it remains difficult for the Ministry of Finance to act against a broadly strong USD environment.At the same time, speculation is increasing that the Bank of Japan may need to tighten policy more than currently expected, with some pricing in a possible 25 bps hike as early as next week.The BOJ is widely expected to raise its main rate by 25 basis points to 1% at its June 15-16 meeting and a second hike sometime this year has also been well priced in.Swap markets on Tuesday were pricing in a 93% chance of a BOJ rate hike this month, up from expectations in May of around an 80% chance. Immediate resistance can be seen at 160.00(Psychological level) an upside break can trigger rise towards 160.00(Psychological level) .On the downside, immediate support is seen at 158.23(SMA 20) a break below could take the pair towards 157.78(50%fib).
Equities Recap
Asian stocks fell on Wednesday, while oil prices surged as escalating Middle East tensions rattled markets, dimming hopes for an end to the prolonged conflict and stoking concerns over inflationary pressures.
Japan’s Nikkei 225 was down by 1.66% , Hang Seng was down at 0.72 %, China A50 was down at 0.61%
Commodities Recap
Gold dipped to an 11-week low on Wednesday, while oil prices advanced on renewed U.S.-Iran tensions, stoking inflation worries and raising expectations of possible interest rate hikes..
Spot gold was down 1.3% at $4,206.08 per ounce by 0558 GMT, after hitting its lowest level since March 23. U.S. gold futures for August delivery shed 1.4% to $4,228.
Oil prices rose on Wednesday, rebounding from a seven-week low in the prior session, after U.S. military strikes on Iran and data showing a larger-than-expected draw in U.S. crude inventories.
Brent futures rose 66 cents, or 0.7%, to $92.11 a barrel at 0406 GMT, while U.S. West Texas Intermediate crude crude climbed 60 cents, or 0.7%, to $88.80.
