Market Roundup
•New Zealand Electronic Card Retail Sales (YoY) (Aug) -2.9%, -4.9% previous
•New Zealand Electronic Card Retail Sales (MoM) (Aug) 0.2%, -0.1% previous
•New Zealand FPI (MoM) (Aug) 0.2%, 0.4% previous
•Japan BSI Large Manufacturing Conditions (Q3) 4.5, -2.5 previous, -1.0 forecast
•Japan Foreign Bonds Buying -222.6B, 1,640.5B previous
•Japan Foreign Investments in Japanese Stocks -902.3B, -824.4B previous
•Australia Inflation Expectations (Sep) 4.4%, 4.5% previous
Looking Ahead Economic Data(GMT)
•07:00 Spanish Core CPI (YoY) (Aug) 2.7% forecast 2.8% previous
•07:00 Spanish CPI (MoM) (Aug) 0.0% forecast -0.5% previous
•07:00 Spanish CPI (YoY) (Aug) 2.2% forecast 2.8% previous
•07:00 Spanish HICP (MoM) (Aug) 0.0% forecast -0.7% previous
•07:00 Spanish HICP (YoY) (Aug) 2.4% forecast 2.9% previous
•11:00 China M2 Money Stock (YoY) 6.2% previous 6.3%previous
•11:00 China Aug New Loans 810.0B forecast, 260.0B previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro remained largely unchanged on Thursday following a slight upside surprise in U.S. core inflation data, which diminished expectations for a significant Federal Reserve rate cut next week. U.S. core CPI rose by 0.28% in August, slightly above the forecasted 0.2%. Investors are now focused on the European Central Bank's policy decision later in the day, with a rate cut almost certain; however, the market is questioning whether the ECB will implement further cuts in October and December. ECB President Christine Lagarde is expected to maintain the bank's stance of making decisions on a meeting-by-meeting basis based on incoming data. Immediate resistance can be seen at 1.1071(38.2%fib), an upside break can trigger rise towards 1.1118(23.6%fib).On the downside, immediate support is seen at 1.1006(50%fib), a break below could take the pair towards 1.0968 (61.8%fib).
GBP/USD: Sterling strengthened on Thursday as digested overnight US inflation data . U.S. consumer prices rose marginally while underlying inflation remained sticky, curbing expectations for a large interest rate cut by the Federal Reserve next week.Excluding the volatile food and energy components, the Consumer Price Index climbed 0.3% in August after rising 0.2% in July. In the 12 months through August, the so-called core CPI increased 3.2%. That followed a 3.2% gain in July. Traders largely bet on 25 basis point cut next week, while a bigger half-point cut had a 13% probability, down from about 34% on Tuesday, CME Group data showed. Immediate resistance can be seen at 1.3110(Daily high), an upside break can trigger rise towards 1.3156(23.6%fib).On the downside, immediate support is seen at 1.3034(38.2%fib), a break below could take the pair towards 1.3000(psychological level).
AUD/USD: The Australian dollar strengthened on Thursday, buoyed by a rebound in global stock markets and recovery in commodities prices helped stabilize risk sentiment. The European Central Bank is widely anticipated to reduce rates by 25 basis points later in the day, with the key uncertainty being whether it will signal further cuts for October and December. Meanwhile, a slightly higher-than-expected core U.S. consumer price index reading of 0.28% led markets to largely abandon hopes for a substantial rate cut by the Federal Reserve next week. This development prompted investors to lower the likelihood of an interest rate cut by the Reserve Bank of Australia (RBA) as soon as November. The Aussie held at $0.6674, after bouncing overnight from the 200-day moving average at $0.6618. Immediate resistance can be seen at 0.6690 (38.2%fib), an upside break can trigger rise towards 0.6758(23.6%fib).On the downside, immediate support is seen at 0.6639 (50%fib), a break below could take the pair towards 0.6607(Lower BB).
NZD/USD: The New Zealand dollar strengthened against the U.S. dollar, supported by a rebound in global stock markets and a recovery in commodity prices, which improved risk sentiment. Gains overshadowed a mixed U.S. inflation report as investors shifted their focus to anticipated interest rate cuts from the European Central Bank this week and the Federal Reserve next week.On the data front, Food prices in New Zealand increased by 0.4% year-on-year in August. On a monthly basis, they rose by 0.2%, a slowdown from the 0.6% gain observed in July, according to Statistics New Zealand. The Reserve Bank of New Zealand is scheduled to meet on October 9, with economists expecting a 25 basis point cut. However, markets suggest a small possibility of a 50 basis point reduction. Immediate resistance can be seen at 0.6263 (23.6%fib), an upside break can trigger rise towards 0.6277(Higher BB).On the downside, immediate support is seen at 0.6195 (38.2%fib), a break below could take the pair towards 0.6141(50%fib).
USD/JPY: The dollar rebounded against the yen on Thursday after U.S. inflation data bolstered expectations for a modest 25 basis point rate cut by the Federal Reserve at its upcoming policy meeting. The dollar gained against the yen, following a turbulent session the previous day that saw the U.S. currency slide as much as 1.24% to the lowest this year before recovering all its losses after the consumer price data.Early on Wednesday, Bank of Japan board member Junko Nakagawa reinforced the central bank's tightening bias by saying low real rates leave room for further rate hikes.On Thursday, fellow BOJ board member Naoki Tamura, known as a policy hawk, said the market's expected pace of tightening could be too slow - comments that helped mitigate yen losses. Strong resistance can be seen at 143.71 (Sep 9th high), an upside break can trigger rise towards 145.00 (Psychological level). On the downside, immediate support is seen at 141.90(23.6%fib), a break below could take the pair towards 141.49 (Lower BB).
Equities Recap
Asian shares rebounded on Thursday following a slight upside surprise in U.S. core inflation data, which tempered expectations for a substantial rate cut by the Federal Reserve next week.
Nikkei 225 was up 3.55percent,Hang Seng gained 1.09 percent ,South koean KOSPI added 2.33%percent.
Commodities Recap
Gold prices inched up on Thursday as traders focused on upcoming U.S. economic data, which could provide additional insights into the anticipated interest rate reduction by the Federal Reserve next week.
Spot gold was up 0.2% at $2,515.59 per ounce, as of 0353 GMT. U.S. gold futures were steady at $2,543.40.
Oil prices increased by more than 1% on Thursday, driven by concerns that Hurricane Francine could affect U.S. output, the largest crude producer globally. However, concerns about declining demand limited the extent of the gains.
Brent crude futures for November were up $1, or 1.4% at $71.61 a barrel at 0632 GMT. U.S. crude futures for October were up 92 cents, or 1.4%, at $68.23 a barrel.
