Market Roundup
• Japan 2-Year JGB Auction 0.454%,0.392% previous
• Sweden GDP (QoQ) (Q3) -0.1%, 0.4% forecast, -0.3% previous
•GfK German Consumer Climate (Nov): -18.3, -20.4 previous, -21.0 forecast
Looking Ahead Economic Data(GMT)
•UK M4 Money Supply (MoM) (Sep) 0.1% forecast, -0.1% previous
•UK Mortgage Approvals (Sep) 65.00K forecast, 64.86K previous
•UK Mortgage Lending (Sep) 2.86B previous
•UK Net Lending to Individuals (Sep) 4.100B forecast, 4.156B previous
•Italian Trade Balance Non-EU (Sep) 2.69B previous
•Belgian GDP (QoQ) (Q3): 0.2% forecast, 0.2% previous
Looking Ahead Events And Other Releases(GMT)
• 08:30 BoE MPC Member Dhingra Speaks
Currency Forecast
EUR/USD: The euro eased on Tuesday as investors awaited the JOLTS job openings report due ahead of highly anticipated monthly non-farm payrolls data on Friday. Recent robust U.S. economic data, including evidence of a resilient job market, have seen bets pared back for easing this year by the Federal Reserve, boosting the dollar. Data this week includes U.S. job openings at 1400 GMT, ADP employment on Wednesday, U.S. Personal Consumption Expenditures on Thursday, and payrolls report on Friday.Then comes Nov. 5, when Americans go to polls to elect a new president. Markets are pricing in about 99% chance of a 25 basis points rate cut by the Fed, according to CME's FedWatch, opens new tab Tool. Strong resistance can be seen at 1.0816(SMA5 ), an upside break can trigger rise towards 1.0847(38.2%fib).On the downside, immediate support is seen at 1.0785(23.6%fib), a break below could take the pair towards 1.0700(Psychological level).
GBP/USD: The pound was little changed on Tuesday as investors were hesitant to take on new positions ahead of US data releases. A raft of economic data underscoring the resilience of the U.S. economy has bolstered the greenback over the past month, as has increasing market bets of a win by Republican candidate Donald Trump at next week's U.S. presidential election.Trump's policies on tariffs, tax and immigration are seen as inflationary, thus negative for bonds and positive for the dollar.Focus is also on a reading on September's U.S. core personal consumption expenditures price index - the Fed's preferred measure of inflation - which comes due on Thursday, followed by the closely watched nonfarm payrolls report on Friday. Immediate resistance can be seen at 1.2978(5 SMA), an upside break can trigger rise towards 1.3028(50%fib).On the downside, immediate support is seen at 1.2922(23.6%fib), a break below could take the pair towards 1.22900 (Psychological level).
AUD/USD: Australian dollar hit two and a half month lows against dollar on Tuesday as a strengthening dollar and declining commodity prices weighed on the Australian dollar. The relentless rise in U.S. yields boosted the greenback, prompting traders to focus on upcoming local quarterly inflation data, which could significantly influence the likelihood of a rate cut this year. Iron ore futures declined on Tuesday, giving up gains from the previous session as uncertainty about China’s fiscal stimulus plans weighed on the market. Investors awaited third-quarter Australian consumer inflation data due on Wednesday. Analysts expect headline inflation to have eased to 2.9% last quarter. Immediate resistance can be seen at 0.6632 (38.2%fib), an upside break can trigger rise towards 0.6678 (50%fib).On the downside, immediate support is seen at 0.5681 (23.6%fib), a break below could take the pair towards 0.5551(Lower BB).
USD/JPY: The dollar eased slightly against the yen on Tuesday as yen found some footing following Monday's plunge to a three-month low as the coalition government's drubbing in weekend elections clouded the outlook for Japanese fiscal and monetary policies. The election results also suggest that a new government may need to seek support from smaller opposition parties and boost spending to win public approval. Looking ahead, the BOJ will announce its monetary policy decision on Thursday, with expectations that the central bank will keep rates unchanged. The dollar slipped 0.24% to 152.92 yen, but that followed a rally to the highest since July 31 at 153.885 yen on Monday. Immediate resistance can be seen at 153.87 (23.6 %fib), an upside break can trigger rise towards 155.00(Psychological level). On the downside, immediate support is seen at 152.69(Daily low), a break below could take the pair towards 150.88(38.2%fib)
Equities Recap
Asian stocks were mixed in volatile trading on Tuesday as investors girded for three days of tech megacap earnings reports on Wall Street, kicking off with Google parent Alphabet later in the day.
Nikkei 225 was up by 0.60%, South Korean KOSPI was up by 0.16%, while Hang Seng was up by 0.32%
Commodities Recap
Oil prices were little changed on Tuesday after falling in the previous session as a U.S. plan to buy oil for the Strategic Petroleum Reserve (SPR) provided some support though wider concerns about weaker future demand growth exerted pressure.
Brent crude futures climbed 4 cents to $71.46 a barrel by 0705 GMT, while U.S. West Texas Intermediate crude was down 1 cent at $67.37 a barrel.
Gold prices lingered near record highs on Tuesday, supported by uncertainty surrounding the upcoming U.S. presidential election, while investors awaited data for clues on the Federal Reserve's interest rate trajectory.
Spot gold was up 0.4% to $2,753.66 per ounce as of 0730 GMT, just shy of a record high of $2,758.37 hit last Wednesday.U.S. gold futures gained 0.4% to $2,765.80
