Market Roundup
• German Industrial Production (MoM) (Oct) 1.8%,0.2% forecast, 1.3% previous.
• German Industrial Production (YoY) (Oct) 0.88%,-0.98% previous.
•Finnish Trade Balance (Oct) 0.16B,-0.43B previous.
•EU Sentix Investor Confidence (Dec) -6.2, -6.2 forecast, -7.4 previous.
Looking Ahead Economic Data (GMT)
•13:30 French 12-Month BTF Auction 2.101% previous
•13:30 French 3-Months BTF Auction 2.069% previous
•13:30 French 6-Months BTF Auction 2.091% previous
•16:00 US Consumer Inflation Expectations (Nov) 3.2% previous
•16:30 US 3-Months Bill Auction 3.725% previous
•16:30 US 6-Month Bill Auction 3.635% previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro edged higher on Monday as the U.S. dollar weakened ahead of a week packed with central bank meetings and headlined by the U.S. Federal Reserve, where an interest rate cut is all but priced in, although the committee is sharply divided.Besides the Fed decision on Wednesday, the central banks of Australia, Brazil, Canada and Switzerland also hold rate-setting meetings, although none of these are expected to change monetary policy.The Federal Open Market Committee has not had three or more dissents at a meeting since 2019, and it has happened just nine times since 1990.Even though the U.S. currency has drifted lower for the past three weeks, dollar bulls have recovered some of their nerve.. Immediate resistance can be seen at 1.1674(Daily high), an upside break can trigger rise towards 1.1692(Higher BB).On the downside, immediate support is seen at 1.1595(SMA20), a break below could take the pair towards 1.1570(38.2%fib).
GBP/USD: The pound dipped on Monday as investors braced for an event-packed week that could include a U.S. interest rate cut.Sterling had climbed to six-week highs last week, supported by relief that Finance Minister Rachel Reeves’ budget was better received than initially feared, and by expectations that the dollar could remain under pressure if the Federal Reserve signals further rate cuts beyond December’s widely anticipated move.Attention now turns to U.K. economic growth data for October, due on Friday. A Reuters poll of economists forecasts year-on-year growth of 1.4% and a 0.1% month-on-month increase, following a September reading that was distorted by a cyberattack at Jaguar Land Rover, which disrupted production and weighed on national output.Meanwhile, money market pricing suggests traders are assigning roughly an 87% probability that the Bank of England will cut interest rates by 25 basis points to 3.75% at its December 18 meeting..Immediate resistance can be seen at 1.3364(Higher BB), an upside break can trigger rise towards 1.3427(61.8%fib).On the downside, immediate support is seen at 1.3295(50%fib), a break below could take the pair towards 1.3182(SMA 20).
AUD/USD: The Australian dollar firmed against its U.S. counterpart on Monday ahead of the central bank’s policy decision.The Reserve Bank of Australia meets on Tuesday, and while a rate hold is widely anticipated, markets will be focused on the central bank’s guidance for clues on the future policy path. Only weeks ago, investors were pricing in at least one rate cut early next year, but recent data pointing to resilient domestic demand and solid job growth have reduced the likelihood of further stimulus.Adding to the cautious outlook, RBA Governor Michele Bullock said in testimony to a parliamentary committee last week that additional policy adjustments would be necessary if inflation remains persistent. Against this backdrop, traders are not expecting a particularly “rosy” message from the central bank. Immediate resistance can be seen at 0.6652(38.2%fib), an upside break can trigger rise towards 0.6706(23.6%fib).On the downside, immediate support is seen at 0.6606(50%fib), a break below could take the pair towards 0.6559(61.8%fib)
USD/JPY: The dollar initially dipped but recovered ground as investors digested Japan's wage growth data . Government data showed Japan’s real wages fell for a tenth consecutive month in October, with increases in nominal pay failing to keep pace with persistent consumer inflation.Wage trends remain a key focus for BOJ policymakers ahead of the December 18–19 meeting, when interest rate decisions will be made. Adding to the mixed economic backdrop, Japan’s gross domestic product contracted at an annualised 2.3%, steeper than the previously reported 1.8%, marking the fastest pace of contraction since the third quarter of 2023, the Cabinet Office said on Monday. Despite the weak growth data, the BOJ is widely expected to raise its policy rate at the December 18–19 meeting, with the government signalling it is prepared to accept the decision. Immediate resistance can be seen at 156.17(Dec 1st high) an upside break can trigger rise towards 157.40 (23.6%fib) .On the downside, immediate support is seen at 155.34 (38.2%fib) a break below could take the pair towards 153.35 (50%fib).
Equities Recap
European shares were little changed on Monday, as losses in consumer-facing stocks offset gains in industrial and healthcare names, with investors awaiting the U.S. Federal Reserve’s monetary policy meeting later this week..
At (GMT 12:38),UK's benchmark FTSE 100 was last trading up at 0.02 percent, Germany's Dax was up by 0.29 percent, France’s CAC was last down by 0.11 percent.
Commodities Recap
Gold prices rose on Monday, supported by mounting expectations of a U.S. interest rate cut that weighed on the dollar, as investors looked ahead to the Federal Reserve’s policy meeting later this week.
Spot gold rose 0.4%to $4,214.41 per ounce by 1252GMT. U.S. gold futures for February delivery were unchanged at $4,243.50 per ounce.
Oil prices fell on Monday as investors monitored ongoing talks to end the war in Ukraine and ahead of an expected U.S. Federal Reserve interest rate cut this week.
Brent crude futures fell by 85 cents, or 1.3%, to $62.90 a barrel by 1300 GMT, while U.S. West Texas Intermediate crude was at $59.22, down 86 cents, or 1.4%.
