Market Roundup
• Australia Construction Work Done (QoQ) (Q3): -0.7%, 0.2% forecast, 2.9% previous
• Australia CPI (QoQ) (Oct): 0.0%, 0.5% forecast
• Australia CPI Index Number (Oct): 99.99, 100.00 previous
• Australia Trimmed Mean CPI (YoY) (Oct): 3.3%, 3.0% forecast, 3.2% previous
• Australia Trimmed Mean CPI (QoQ) (Oct): 0.3%, 0.3% previous
• Australia Monthly CPI Indicator (YoY) (Oct): 3.8%, 3.6% forecast, 3.5% previous
• Australia Weighted Mean CPI (QoQ) (Oct): 0.3%, 0.4% previous
• Australia Weighted Mean CPI (YoY) (Oct): 3.4%, 3.3% previous
• New Zealand RBNZ Interest Rate Decision: 2.25%, 2.25% forecast, 2.50% previous
Looking Ahead Economic Data (GMT)
•09:00 Swiss ZEW Expectations (Nov) -7.7 previous
•10:10 Italian 6-Month BOT Auction 1.974% previous
•10:30 German 10-Year Bund Auction 2.620% previous
Looking Ahead Events And Other Releases (GMT)
• 09:00 ECB Financial Stability Review
Currency Forecast
EUR/USD : The euro edged lower against the dollar on Wednesday as investors awaited key economic data from both the US and Germany. Several US indicators delayed by the government shutdown including retail sales, jobless claims, and producer price data are set to be released this week and are expected to provide clearer signals on the Federal Reserve’s rate-cut trajectory.The eurozone’s data calendar remains relatively light, with economic-sentiment and consumer-confidence surveys due. Germany, however, faces a busier schedule with final Q3 GDP, retail sales, and CPI all lined up for release. Meanwhile, the European Central Bank will publish the minutes of its October policy meeting on Thursday, and ECB President Christine Lagarde is also slated to speak. Immediate resistance can be seen at 1.1600(Psychological level), an upside break can trigger rise towards 1.16818(Higher BB).On the downside, immediate support is seen at 1.1558(SMA20), a break below could take the pair towards 1.1524(50%fib).
GBP/USD: Sterling edged lower against the dollar on Wednesday as traders awaited clarity from the upcoming UK budget. British Finance Minister Rachel Reeves is expected to unveil tens of billions of pounds in new tax hikes on Wednesday, in a budget that will test her credibility with both bond investors and lawmakers pressing for increased welfare spending.Just over a year after implementing £40 billion ($52.7 billion) of tax increases—the largest since the 1990s and promised as a one-off—Reeves is now facing the need for additional revenue measures due to a likely downgrade of Britain’s economic outlook and rising debt costs. Economists anticipate tax rises totaling between £20 billion and £30 billion when she addresses Parliament around 1230 GMT. Investors say Reeves must deliver a credible plan that boosts revenues quickly. Immediate resistance can be seen at 1.3253(38.2%fib), an upside break can trigger rise towards 1.3273(SMA 20).On the downside, immediate support is seen at 1.3122(SMA 20), a break below could take the pair towards 1.3051(23.6%fib).
AUD/USD: The Australian dollar surged against the U.S. dollar after a stronger-than-expected inflation report reinforced expectations of a hawkish Reserve Bank of Australia (RBA) policy stance. Australian consumer inflation accelerated for a fourth consecutive month in October, according to a new data series released on Wednesday, prompting markets to scale back hopes for further easing and even consider the possibility of a rate hike.Data from the Australian Bureau of Statistics showed the monthly CPI rose 3.8% year-on-year, the fastest pace in 10 months and above the 3.6% forecast. The trimmed mean measure of core inflation also rose to 3.3% annually in October, up from 3.2% in September. Investors sharply reduced their expectations for the RBA to deliver a final rate cut in May next year, with odds dropping to just 8% from 40% previously. Immediate resistance can be seen at 0.6514(50%fib), an upside break can trigger rise towards 0.6523 (Higher BB).On the downside, immediate support is seen at 0.6424(38.2%fib), a break below could take the pair towards 0.6447(Lower BB)
USD/JPY: The U.S. dollar edged higher on Wednesday as the Japanese yen weakened, despite reports that the Bank of Japan could consider an interest rate hike as early as next month. The yen has been under pressure amid growing concerns over Japan’s worsening fiscal situation, while traders remain alert to the possibility of intervention from Tokyo to curb the currency’s decline.On Sunday, Takuji Aida, an adviser to Prime Minister Sanae Takaichi, said that Tokyo is prepared to intervene proactively to counter the negative economic impact of a weak yen. Data released on Wednesday showed that a key indicator of Japan’s services sector prices rose 2.7% year-on-year in October, reflecting how labor shortages continue to push companies to pass on higher costs. Bank of Japan data also showed that the services producer price index, which measures the prices companies charge each other for services, rose 2.7% in October, slowing from a revised 3.1% increase in September.. Immediate resistance can be seen at 157.66(23.6%fib) an upside break can trigger rise towards 158.00 (Psychological level) .On the downside, immediate support is seen at 156.85 (Daily low) a break below could take the pair towards 155.34 (38.2%fib)
Equities Recap
Most emerging Asian stock markets advanced on Wednesday, led by South Korea and Taiwan, as investor expectations increased for a potential U.S. Federal Reserve interest rate cut next month.
China A50 jumped 0.80% and South Korea's Kospi was up 2.67%. Hong Kong's Hang Seng added 0.36%.
Commodities Recap
Gold rose to a near two-week high Wednesday as U.S. economic data fueled expectations of a December Fed rate cut, weakening the dollar.
Spot gold rose 0.7% to $4,156.89 per ounce, as of 0615 GMT, its highest since November 14. U.S. gold futures for December delivery were up 0.4% at $4,154.10 per ounce
Oil prices rose Wednesday after hitting a one-month low, but gains were limited by expected supply surpluses and a potential Russia-Ukraine peace deal.
Brent crude futures rose 27 cents, or 0.43%, to $62.75 a barrel at 0412 GMT, while U.S. West Texas Intermediate crude futures gained 24 cents, or 0.41%, to $58.19 a barrel.
