Market Roundup
•Italian Apr HICP (MoM) 0.5%, 0.6% forecast, 1.2% previous
•Italian Apr Italian CPI (YoY) 0.8%, 0.9% forecast, 1.2% previous
•Italian Apr HICP (YoY) 0.9%,1.0% forecast, 1.2% previous
•Italian Apr Italian CPI Ex Tobacco (YoY) 0.8%, 1.2% previous
•Italian Apr CPI (MoM) 0.1%, 0.2% forecast, 0.0% previous
•Italian Mar Trade Balance 4.341B,4.770B forecast,6.034B previous
Looking Ahead Economic Data(GMT)
•US Import Price Index (YoY) 1.1% ,0.4% previous
•US Export Price Index (YoY) -1.0% ,-1.4% previous
•US Jobless Claims 4-Week Avg. 217.75K, 215.00K previous
•US Continuing Jobless Claims 1,794K ,1,780K forecast,1,785K previous
•US Apr Building Permits 1.440M ,1.480M forecast,1.467M previous
•US Initial Jobless Claims 222K 219K forecast,231K previous
•US Apr Housing Starts (MoM) 5.7% ,-14.7% previous
•US May Philly Fed CAPEX Index 20.10,20.00 previous
•US May Philly Fed Prices Paid 18.70 ,23.00 previous
•US May Philly Fed Employment -7.9, -10.7 previous
•US Philadelphia Fed Manufacturing Index 4.5,.7 forecast,15.5 previous
•US Apr Export Price Index (MoM) 0.5% , 0.4% forecast,0.3% previous
•US Apr Import Price Index (MoM) 0.9%, 0.2% forecast,0.4% previous
•US Apr Housing Starts 1.360M, 1.420M forecast,1.321M previous
•US Apr Building Permits (MoM) -3.0% , -3.7% previous
•US Apr Industrial Production (YoY) -0.38%,0.00% previous
•US Apr Manufacturing Production (MoM) -0.3%, 0.1% forecast,0.5% previous
•US Apr Capacity Utilization Rate 78.4%, 78.4% forecast, 78.4% previous
•US Apr Industrial Production (MoM) 0.0%,0.1% forecast, 0.4% previous
Looking Ahead Economic Data(GMT)
•15:15 US Atlanta Fed GDPNow (Q2) 3.8% forecast, 3.8% previous
•15:13 US 4-Weeks Bill Auction 5.270% previous
•15:30 US 8-Week Bill Auction 5.275% previous
Looking Ahead Events And Other Releases(GMT)
•14:00 US Fed Vice Chair for Supervision Barr Speaks
•14:00 US FOMC Member Harker Speaks
•15:30 US FOMC Member Mester Speaks
•19:50 US FOMC Member Bostic Speaks
Currency Forecast
EUR/USD: The euro eased against dollar on Thursday as the dollar regained its ground, following a significant decline on Wednesday spurred by data indicating a slowdown in U.S. inflation. The market is back to betting squarely on two quarter-point interest rate cuts from the Federal Reserve thisU.S. dollar fell on Wednesday as data showed U.S. consumer prices rose less than expected in April, suggesting inflation has resumed a downward trend in the second quarter.The CPI report raised expectations that the Federal Reserve will cut interest rates two times this year. year, with the first fully priced for September, and July now in play. The euro hit a two-month high at $1.0895 on Thursday before dipping to trade 0.1% lower at $1.0901.Immediate resistance can be seen at 1.0901 (23.6%fib), an upside break can trigger rise towards 1.0940(21st Mar).On the downside, immediate support is seen at 1.0835 (38.2% fib), a break below could take the pair towards 1.0768(50% fib).
GBP/USD: Sterling eased on Thursday as dollar found a footing on Thursday after falling sharply on Wednesday on the back of data showing a slowdown in U.S. inflation. U.S. inflation slowed to 0.3% in April from a month earlier, down from 0.4% in March and below expectations for another 0.4% reading, Wednesday's data showed.Year-on-year core inflation - which strips out volatile food and energy prices - fell to its lowest in three years at 3.6%. The dollar index , which tracks the currency against six major peers, was last up 0.22% at 104.43 on Thursday after falling 0.75% on Wednesday as investors raised their bets on Fed rate cuts, now envisaging two reductions by the end of the year. Britain's pound reached a one-month top of $1.2675 before falling back slightly . Immediate resistance can be seen at 1.2701(23.6%fib), an upside break can trigger rise towards 1.2716(Higher BB).On the downside, immediate support is seen at 1.2626(38.2% fib), a break below could take the pair towards 1.2558 ( 50% fib).
USD/CHF: The dollar edged higher against the Swiss franc on Thursday as green back found a footing after falling on weaker US inflation. The CPI report raised expectations that the Federal Reserve will cut interest rates two times this year. The U.S. Bureau of Labor Statistics said its consumer price index rose by 0.3% in April, below expectations for an increase of 0.4%, while on an annual basis, CPI was up 3.4%, in line with forecasts and below the previous month's 3.5% rate.Investors do not anticipate any rate hikes in 2024, but they have had to dial back expectations for rate cuts, given the persistence of inflation. On the data front, New claims for state unemployment benefits fell 10,000 to a seasonally adjusted 222,000 for the week ended May 11, a Labor Department report showed, pointing to underlying strength in the labor market. Immediate resistance can be seen at 0.9076 (May 10th high), an upside break can trigger rise towards 0.9150 (23.6% fib).On the downside, immediate support is seen at 0.9039 (38.2% fib), a break below could take the pair towards 0.9017(Lower BB).
USD/JPY: The U.S. dollar initially dipped against yen on Thursday but recovered most the ground as dollar rebounded after falling on weaker US inflation . The dollar dropped 1% against the yen on Wednesday after the data and was down a further 0.05% on Thursday at 154.80. The Japanese currency has fallen around 9.5% this year as the Bank of Japan has kept monetary policy loose while higher Fed interest rates have drawn money towards U.S. bonds and the dollar. The yen has been particularly sensitive to any widening or closing of the interest rate differential. Markets will now focus on several Fed officials expected to speak through the day, including Thomas Barkin, Loretta Mester, Raphael Bostic, Patrick Harker and Michael Barr. Strong resistance can be seen at 155.52 (38.2%fib), an upside break can trigger rise towards 156.86(May 14th high).On the downside, immediate support is seen at 153.93(50% fib), a break below could take the pair towards 152.15(61.8% fib).
Equities Recap
Europe's benchmark index climbed to a record high on Wednesday, as investors cheered a handful of robust earnings from the likes of UK's Experian and Germany's Commerzbank, while they also buckled up for the highly anticipated U.S. inflation data.
UK's benchmark FTSE 100 was last up by 0.03 percent, Germany's Dax was last down up by 0.53 percent, France’s CAC was last down by 0.43 26 percent.
Commodities Recap
Gold near one-month highGold prices hovered near a one-month high on Thursday as signs of inflation stabilizing in the U.S. increased the likelihood of rate cuts by the Federal Reserve as early as September.
Spot gold was little changed at $2,384.07 per ounce as of 1155 GMT, after hitting its highest since April 19 earlier in the session. Bullion rose over 1% on Wednesday.
Brent oil futures held steady on Thursday, bolstered by signs of stronger demand in the U.S. after slower than expected inflation in April and lower oil stocks in the past week.
Brent crude futures were up 4 cents, or 0.05%, at $82.79 a barrel by 1120 GMT. U.S. West Texas Intermediate crude (WTI) gained 4 cents, or 0.05%, to $78.67.
