Market Roundup
• Australia Jul Housing Credit 0.5%,0.4% previous
• Australia Jul Private Sector Credit (MoM) 0.5%,0.5%forecast, 0.6% previous
• Australia Jul Retail Sales (MoM) 0.0%,0.3% forecast, 0.5% previous
•Japan Aug Industrial Production forecast 1m ahead (MoM) 2.2%, 6.5% previous
• Japan Jul Retail Sales (YoY) 2.6%,2.8% forecast, 3.8%previous
Looking Ahead Economic Data (GMT)
• 07:00 French Jul Consumer Spending (MoM) 0.4% previous, -0.5%
• 07:00 French Aug CPI (YoY) 1.8% forecast, 2.3% previous
• 07:00 French Aug CPI (MoM) 0.5% forecast, 0.2% previous
• 07:00 French Q2 GDP (QoQ) 0.3% forecast, 0.2% previous
• 07:00 French Q2 GDP (YoY) 1.1% previous
• 07:00 French Aug HICP (YoY) 2.1% forecast, 2.7% previous
• 07:00 French Aug HICP (MoM) 0.5% forecast, 0.2% previous
• 07:55 German Aug Unemployment Change 17K forecast, 18K previous
• 07:55 German Unemployment Rate 6.0% forecast, 6.0% previous
• 07:55 German Unemployment 2.802M forecast, 2.809M previous
• 07:55 German Unemployment n.s.a. 2.809M previous
• 09:00 Italian Aug CPI (YoY) 1.2% forecast, 1.3% previous
• 09:00 Italian Aug CPI (MoM) 0.3% forecast, 0.4% previous
• 09:00 EU Aug Core CPI (MoM) -0.2% previous
• 09:00 EU Aug Core CPI (YoY) 2.8% forecast, 2.9% previous
• 09:00 EU Aug CPI (YoY) 2.2% forecast, 2.6% previous
• 09:00 EU Aug CPI (MoM) 0.0% previous
• 09:00 EU Aug PI, n.s.a. 126.54 previous
Looking Ahead Events And Other Releases (GMT)
• 10:00 Eurogroup Meetings
Currency Forecast
EUR/USD: The euro fell against the dollar on Friday as stronger-than-expected Q2 GDP and slightly better jobless claims data led markets to reassess recent dovish Fed expectations. The second estimate for Q2 GDP growth was revised up to 3.0%, surpassing the 2.8% forecast, while initial jobless claims totaled 231,000 for the latest week, slightly below the 232,000 estimate. However, the previous week’s claims were revised upward by 1,000 to 233,000. Upcoming U.S. PCE inflation data and next week’s labor market figures are expected to be crucial in shaping expectations for potential Federal Reserve rate cuts ahead of the September meeting Immediate resistance can be seen at 1.1138(Aug 29th high), an upside break can trigger rise towards 1.1200(Psychological level).On the downside, immediate support is seen at 1.1070(38.2%fib), a break below could take the pair towards 1.1047 (50%fib).
GBP/USD: The British pound dipped against the U.S. dollar on Friday as strong U.S. economic data diminished expectations for aggressive Federal Reserve interest rate cuts. Overnight data showed that U.S. GDP grew at a 3.0% annualized rate in the second quarter, revised up from the previously reported 2.8%. Economists had expected no change. Traders now more strongly favor a quarter-point Fed rate reduction on September 18, with the probability of a 50-basis-point cut falling to 34% from 38% the previous day, according to CME Group's FedWatch Tool.Immediate resistance can be seen at 1.3284(23.6%fib), an upside break can trigger rise towards 1.3315(Higher BB).On the downside, immediate support is seen at 1.3115(38.2%fib), a break below could take the pair towards 1.3052(50%fib).
AUD/USD: AUD/USD remained steady on Friday despite weaker-than-expected Australian retail sales data, as traders looked ahead to the upcoming U.S. PCE inflation report. The data showed that Australian retail sales were flat in July, missing analysts' forecasts of a 0.3% increase. Market attention has now shifted to the U.S. PCE inflation report, which is anticipated to play a pivotal role in determining the potential size of the Federal Reserve's next rate cut. The Aussie stood at $0.6806 after touching a fresh eight-month top of $0.6823. Immediate resistance can be seen at 0.6821(23.6%fib), an upside break can trigger rise towards 0.6865(Higher BB).On the downside, immediate support is seen at 0.6733 (July 10th low), a break below could take the pair towards 0.6705(38.2%fib).
NZD/USD: NZD/USD remained steady on Friday as the New Zealand dollar sustained its momentum, bolstered by Thursday’s strong business confidence data. The business confidence index in New Zealand soared to 50.6 in August, up from 27.1 in July, marking the highest reading in a decade. A quarter-point rate cut by the RBNZ is still fully priced in for October, but markets have somewhat reduced the likelihood of a half-point move. The kiwi held firm at $0.6262 against the U.S. dollar, after peaking at $0.6298 overnight. Immediate resistance can be seen at 0.6300(23.6%fib), an upside break can trigger rise towards 0.6312 (Higher BB).On the downside, immediate support is seen at 0.6233 (38.2%fib), a break below could take the pair towards 0.6180(50%fib).
USD/JPY: The dollar gained against the yen on Friday, supported by stronger-than-expected U.S. economic data that tempered expectations for a 50-basis point Federal Reserve rate cut. The Bureau of Economic Analysis reported that GDP grew at a 3.0% annualized rate in the second quarter, surpassing previous estimates. Investors are now focused on the U.S. personal consumption expenditures (PCE) index, the Fed's preferred inflation measure, due later on Friday, as well as next week's labor market report, for further insights into the Fed's future interest rate decisions. Strong resistance can be seen at 145.00(Psychological level), an upside break can trigger rise towards 146.56(38.2 %fib). On the downside, immediate support is seen at 143.75(23.6 %fib), a break below could take the pair towards 142.28(Lower BB).
Equities Recap
Asian stocks rose on Friday and were poised for a solid end to August.
Taiwan's benchmark index and South Korea's KOSPI both tech-heavy indexes, recovered from Thursday's losses to trade 0.44% and 0.7% higher, respectively.
Japan's Nikkei was last up 0.3% on Friday.
Commodities Recap
Oil prices inched higher on Friday as investors weighed supply concerns in the Middle East, although signs of weakened demand limited gains.
Brent crude futures for October delivery , which expire on Friday, were up 23 cents, or 0.3%, at $80.17 a barrel by 0410 GMT. The more actively traded contract for November rose 20 cents, or 0.2%, to $79.02.
Gold prices eased on Friday, but were on track for a second straight month of gains on rising bets of a Federal Reserve rate cut next month, while traders awaited key U.S. inflation data for additional guidance.
Spot gold was down 0.3% at $2,513.70 per ounce as of 0543 GMT. The bullion is up about 3% for the month.
U.S. gold futures fell 0.5% to $2,547.10.
