Market Roundup
•New Zealand Terms of Trade - Exports Prices (Q3): 0.7%, 1.4% forecast, 5.2% previous
•New Zealand Terms of Trade - Imports Prices (Q3): -1.7%, -0.6% forecast, 3.1% previous
•New Zealand Terms of Trade Index (QoQ) (Q3): 2.4%, 1.2% forecast, 2.1% previous
•New Zealand Terms of Trade - Exports Volume (QoQ) (Q2): -1.8%, 5.2% previous
•Australia Current Account (Q3): -14.1B, -10.3B forecast, -16.4B previous
•Australia Net Exports Contribution (Q3): 0.1%, 0.4% forecast, 0.2% previous
Looking Ahead Economic Data (GMT)
•08:00 Spanish Unemployment Change (Nov) 29.3K forecast, 26.8K previous
• 10:00 French Car Registration (YoY) (Nov): -11.1% previous
•10:30 German 2-Year Schatz Auction: 2.110% previous
•11:00 EU Car Registration (YoY) (Nov): 7.20% previous
•11:00 EU Car Registration (MoM) (Nov): 14.10% previous
Looking Ahead Events And Other Releases (GMT)
•No Event Ahead
Currency Forecast
EUR/USD: The euro weakened on Tuesday as the dollar remained strong, with political instability in France weighing on the currency. The French government is likely to collapse later this week after far-right and left-wing parties filed no-confidence motions against Prime Minister Michel Barnier. The combined votes from RN lawmakers and the left-wing coalition could topple Barnier, with Marine Le Pen confirming her party's support for the left-wing motion alongside their own. The vote is expected on Wednesday. A government collapse would create instability at the heart of Europe, as Germany also faces election challenges, just weeks before U.S. President-elect Donald Trump's return to the White House. Immediate resistance can be seen at 1.0567(Daily high), an upside break can trigger rise towards 1.0614(50%fib).On the downside, immediate support is seen at 1.0478(23.6%fib), a break below could take the pair towards 1.0358(Lower BB)
GBP/USD: The pound eased on Tuesday as the dollar continued to strengthen, driven by U.S. President-elect Donald Trump's tariff threats. While the dollar usually weakens seasonally in December due to increased foreign currency buying by companies, traders are staying cautious this year, watching the incoming Trump administration and keeping the dollar strong. Markets are also awaiting U.S. employment data on Friday to refine expectations on whether the Federal Reserve will cut rates later this month, with the odds currently seen as evenly split. Sterling fell 0.1% to $1.2646. Immediate resistance can be seen at 1.2755(50%fib), an upside break can trigger rise towards 1.2800 (Psychological level).On the downside, immediate support is seen at 1.2652(38.2%fib), a break below could take the pair towards 1.2519(23.6%fib)
AUD/USD: The Australian dollar dipped against dollar Tuesday as higher iron ore prices and stronger US dollar weighed Australian dollar. Dalian iron ore futures rose for a third consecutive session on Tuesday, reaching a two-month high, driven by expectations of economic stimulus and seasonal restocking by Chinese steelmakers. On the data front, Australia's current account deficit exceeded expectations in the third quarter, reaching A$14.1 billion ($9.12 billion) for the September quarter, higher than the anticipated A$10.0 billion shortfall, according to data from the Australian Bureau of Statistics. Economic data was mixed, with a a bigger-than-forecast current account deficit countered by a jump in government spending that is likely to boost growth. The Australian dollar was marginally down at $0.6472. Immediate resistance can be seen at 0.6538(38.2%fib), an upside break can trigger rise towards 0.6580(50%fib).On the downside, immediate support is seen at 0.6470(23.6%fib), a break below could take the pair towards 0.6436(Nov 26th low).
USD/JPY: The dollar strengthened against the yen on Tuesday as greenback was supported by expectations of U.S. economic outperformance and President Trump's tariff threats against other major economies. The dollar received some support overnight from better-than-expected U.S. manufacturing data, which also showed a mitigation in price increases.Traders currently see about a 75% chance of a quarter-point cut at this month's Fed meeting, up from 66% a day earlier and 52% a week ago, CME's FedWatch Tool showed. JOLTS job openings - a preferred gauge of Fed officials is due later on Tuesday, ahead of the monthly payrolls figures on Friday. Immediate resistance can be seen at 150.15 (38.2%fib) an upside break can trigger rise towards 150.97 (50%fib). On the downside, immediate support is seen at 149.07(50%fib) a break below could take the pair towards 148.41(Lower BB).
Equities Recap
Asian stocks surged on Tuesday, driven by a strong performance in the tech sector, following record highs on Wall Street overnight.
Japan's tech-heavy Nikkei N225 rallied 2.2% , and South Korea's KOSPI advanced 1.8%. Taiwanese shares TWII gained 1.4%.
Commodities Recap
Oil prices edged higher on Tuesday but stayed within a narrow range, as traders awaited the outcome of an OPEC+ meeting later in the week.
Brent crude futures rose 31 cents, or 0.4%, to $72.14 a barrel by 0704 GMT, after dropping 1 cent in the previous session. U.S. West Texas Intermediate crude climbed 26 cents, or 0.4%, to $68.36, following a 10 cent gain on Monday.
Gold prices held steady on Tuesday as investors adopted a cautious approach ahead of upcoming U.S. economic data, which could offer clues about the Federal Reserve's interest rate direction.
Spot gold was nearly unchanged at $2,638.73 per ounce, as of 0501 GMT, after falling as much as 1% on Monday. U.S. gold futures was 0.1% up at $2,661.10.
