Market Roundup
• New Zealand Current Account % of GDP (Q2) 6.70%, -6.70% previous
• New Zealand GDP (QoQ) (Q2) -0.2%, -0.4% forecast, 0.1% previous
• New Zealand GDP (YoY) (Q2) -0.5%, -0.5% forecast, 0.5% previous
• New Zealand GDP Annual Average (Q2) -0.2%, 0.3% previous
• New Zealand GDP Expenditure (QoQ) (Q2) 0.0%, 0.3% previous
• Australia Employment Change (Aug): 47.5K, 26.4K forecast, 48.9K previous
• Australia Full Employment Change (Aug): -3.1K, 64.7K previous
• Australia Participation Rate (Aug): 67.1%, 67.1% forecast, 67.1% previous
• Australia Reserve Assets Total (Aug): 93.1B, 96.2B previous
• Australia Unemployment Rate (Aug): 4.2%, 4.2% forecast, 4.2% previous
Looking Ahead Economic Data (GMT)
•11:00 GBP BoE MPC Vote Hike (Sep): 0, 0 previous
•11:00 GBP BoE MPC Vote Unchanged (Sep) 7 forecast, 4 previous
• 11:00 UK BoE Interest Rate Decision (Sep) 5.00% forecast, 5.00% previous
•08:00 EU Current Account (Jul) 40.3B forecast, 51.0B previous
•08:00 EU Current Account n.s.a. (Jul) 52.4B previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro strengthened on Thursday as investors digested Federal Reserve's super-sized rate cut. The U.S. central bank began its monetary easing cycle with an unusually large half-percentage-point reduction. Chair Jerome Powell indicated that this move was intended to reaffirm policymakers' commitment to maintaining low unemployment now that inflation has eased. While the size of the move had been anticipated by investors in part due to a slew of media reports pointing in that direction ahead of the decision, it defied the expectations of economists polled by Reuters, who were leaning toward a 25-basis-point cut Immediate resistance is noted at 1.1142 (23.6%fib), with a breakout potentially pushing the pair towards 1.1191 (Higher BB). On the downside, immediate support is at 1.1075 (Sep 16th low), a drop below this level could lead the pair towards 1.1000 (Psychological level).
GBP/USD: The British pound gained against the dollar on Thursday ahead of the Bank of England's policy decision. The central bank is expected to keep interest rates steady, although traders are anticipating cuts in November and December, with an additional five reductions expected in 2025.The easing cycle began in August when the central bank lowered borrowing costs by 25 basis points. In the UK, the annual inflation rate held steady at 2.2% in August, meeting expectations, while services inflation rose to 5.6%, as predicted. Core inflation also increased to 3.6%, surpassing forecasts of 3.5%. Immediate resistance can be seen at 1.3220(23.6%fib), an upside break can trigger rise towards 1.3256(Higher BB).On the downside, immediate support is seen at 1.3121(38.2%fib), a break below could take the pair towards 1.3033(61.8%fib).
AUD/USD Australian dollar recovered from early losses on Thursday, buoyed by Australian strong jobs report that tempered the overall strength of the U.S. dollar. Australian employment figures revealed an increase of 47,500 jobs in August, far exceeding forecasts of a 25,000 gain for the third month in a row. The unemployment rate held steady at 4.3%, as expected. This continued strength in hiring highlights a tight labor market, bolstering the Reserve Bank of Australia's (RBA) stance against the need for a near-term rate cut. Immediate resistance can be seen at 0.6801(23.6%fib), an upside break can trigger rise towards 0.6861 (Higher BB).On the downside, immediate support is seen at 0.6742 (Sep 17th low), a break below could take the pair towards 0.6704 (38.2%fib).
USD/JPY: The dollar was little changed on Thursday as traders absorbed a significant interest rate cut from the Federal Reserve, which lowered borrowing costs for the first time in over four years. The U.S. central bank reduced the overnight rate by half a percentage point, exceeding the typical quarter-point adjustment, citing increased confidence that inflation will continue to decline toward its 2% annual target. This half-percentage-point cut was a clear signal that the Fed is committed to protecting the labor market and steering the economy away from any potential recession. Strong resistance can be seen at 144.23 (50%fib), an upside break can trigger rise towards 145.00 (psychological level). On the downside, immediate support is seen at 143.14(38.2%fib), a break below could take the pair towards 141.64(23.6%fib).
Equities Recap
Japan's Nikkei share average reached its highest closing level in over two weeks on Thursday, driven by exporters as the yen weakened against the dollar amid expectations of slower-than-anticipated rate cuts by the U.S. Federal Reserve.
The Nikkei climbed 2.13%, finishing at 37,155.33, its highest close since September 3.
Commodities Recap
-Gold prices rose on Thursday after hitting a record high in the previous session, as the U.S. Federal Reserve delivered a super-sized interest rate cut.
Spot gold rose 0.5% to $2,571.40 per ounce, as of 0543 GMT after scaling a record high of $2,599.92 on Wednesday.U.S. gold futures edged 0.1% down to $2,595.90.
Oil prices rose on Thursday after a large interest rate cut from the U.S. Federal Reserve, but concerns over global demand lingered and capped gains.
Brent crude futures for November were up 36 cents, or 0.5%, to $74.01 a barrel at 0618 GMT, while WTI crude futures for October were up 34 cents, or 0.3%, to $71.15 a barrel. The benchmarks recovered after falling in early Asian trade.
