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Market Roundup
• UK Core Retail Sales (MoM) (Aug) 0.6%, -0.2% forecast, -0.9% previous
•UK Core Retail Sales (MoM) (Aug) 0.6%, -0.2% forecast, -0.9% previous
•UK Core Retail Sales (YoY) (Aug) 2.7%, 1.9% forecast, 1.8% previous
•UK Retail Sales (YoY) (Aug) 2.4%, 1.9% forecast, 1.2% previous
•UK Retail Sales (MoM) (Aug) 0.5%, -0.2% forecast, -0.5% previous
•German PPI (MoM) (Aug) 1.1%, 0.6% forecast, 1.1% previous
•German PPI (YoY) (Aug) 4.6%, 4.1% forecast, 3.0% previous
•Eurozone Current Account (Jul) 27.6B, 30.7B forecast, 35.1B previous
•Eurozone Current Account n.s.a. (Jul) 36.5B, 46.9B previous
•Eurozone Construction Output (MoM) (Jul) 0.00%, -1.53% previous
•US Industrial Production (MoM) (Aug) 0.0%, 0.3% forecast, 0.2% previous
•US Manufacturing Production (MoM) (Aug) -0.3%, 0.3% forecast, 0.2% previous
•US Capacity Utilization Rate (Aug) 76.3%, 76.4% forecast, 76.3% previous
Looking Ahead Economic Data (GMT)
•17:00 US Baker Hughes Oil Rig Count 450 previous
•17:00 US Baker Hughes Total Rig Count 591 previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro edged higher on Friday as market participants kept their focus on developments in the Middle East and the outlook for global monetary policy. The Federal Reserve raised interest rates on Wednesday and flagged more hikes in the coming months.The Bank of Japan raised interest rates to a 31-year high and signalled its readiness to keep pushing up borrowing costs. The Bank of England kept interest rates on hold on Thursday but warned they might have to go up. The euro was up at $1.148, but on course for a 1% drop for the week, its biggest drop since June.Immediate resistance can be seen at 1.1566(50%fib), an upside break can trigger rise towards 1.1609(SMA20).On the downside, immediate support is seen at 1.1463(38.2%fib), a break below could take the pair towards 1.1339(23.6%fib).
GBP/USD: The pound dipped on Friday as markets approached the end of a turbulent week marked by a global push by central banks to quell inflation.Monetary policy has been the prime focus this week, as the war in the Middle East nears the seven-month mark with few signs of ending, which is keeping oil prices above $100 per barrel and fanning inflation fears.UK retail sales unexpectedly rose in August, continuing a string of recent upbeat data that has increased pressure on the Bank of England to hike interest rates. Retail sales volumes rose 0.5% from July, beating economists' forecasts in a Reuters poll for a 0.2% fall. Compared with August last year, overall sales volumes were up by 2.4%.The BoE kept rates on hold at 3.75% on Thursday but said inflation would likely now peak above 4% early next year and warned borrowing costs might go up if the Iran war drags on.The pound ticked very slightly higher after the figures were released and was last up 0.1% at $1.337. Immediate resistance can be seen at 1.3469(50%fib), an upside break can trigger rise towards 1.3526(SMA20).On the downside, immediate support is seen at 1.3323(38.2%fib), a break below could take the pair towards1.3296 (Lower BB).
AUD/USD: The Australian dollar initially gained but gave up ground on Friday as investors assessed comments from Reserve Bank of Australia Governor Michele Bullock, who said some upside risks to inflation are beginning to materialise. Bullock told lawmakers that the Middle East conflict and the AI boom were adding to price pressures, while policymakers will assess whether this year’s three rate hikes, which lifted the cash rate to a post-pandemic high of 4.35%, will be enough to return inflation to the 2%-3% target. Markets are pricing a 95% chance of a 25-basis-point RBA rate hike on Sept. 29. Investors are also watching U.S. President Donald Trump’s planned meeting with Chinese President Xi Jinping in Washington next week, with any changes in U.S.-China trade relations likely to affect Australia given its strong trade ties with China. Immediate resistance can be seen at 0.7151(38.2%fib), an upside break can trigger rise towards 0.7170(SMA 20).On the downside, immediate support is seen at 0.7095 (Lower BB), a break below could take the pair towards 07054(50%fib)
USD /JPY : The U.S. dollar rose higher on Friday as yen sank after two policy makers at the Bank of Japan dissented from a widely expected decision to raise interest rates, raising doubt among traders about the likelihood of further hikes. Policymakers pushed rates to their highest level in 31 years at 1.25%, yet the move failed to boost the currency as traders felt there was a lack of explicitly hawkish guidance. Traders see a roughly 55% chance of a quarter-point hike at the Fed's next two-day meeting next month, up from 27% a week ago, according to the CME Group's FedWatch tool. Oil prices slipped to their lowest levels in around a week on signs of easing supply pressures in Saudi Arabia. Immediate resistance can be seen at 157.54 (Daily high), an upside break can trigger rise towards 158.45(38.2%fib).On the downside, immediate support is seen at 156.89(50%fib) a break below could take the pair towards 153.45 (61.8%fib).
Equities Recap
European stocks slipped on Friday, led by losses in telecom shares, but remained on track for modest weekly gains after a week of falling oil prices and several central bank rate decisions.
UK's benchmark FTSE 100 was down by1.40 percent, Germany's Dax was down 1.42percent, France’s CAC was down by 1.41 percent.
Commodities Recap
Gold prices climbed to a one-week high on Friday, and were on track for their first weekly gain in four, as lower oil prices eased concerns about prolonged inflationary pressures, though a stronger dollar limited gains.
Spot gold was up 0.7% at $4,372.27 per ounce by 09:16 a.m. EDT (1316 GMT), after hitting its highest level since September 11 earlier in the session.
Oil prices fell on Friday as easing concerns over Saudi supply disruptions outweighed anxiety about a widening of conflict across the Middle East.
Brent crude futures fell by 88 cents, or 0.84%, to $103.94 a barrel by 1225 GMT. U.S. West Texas Intermediate futures were little changed at $102.15.
