Market Roundup
•German Apr CPI (MoM) 0.8%,0.8% forecast, 2.5 previous
•German Apr HICP (YoY) 7.8%, 7.8% forecast, 7.6% previous
•German Apr CPI (YoY) 7.4%, 7.4% forecast, 7.3% previous
Looking Ahead - Economic Data (GMT)
•12:30 US Apr CPI Index, s.a 287.71 previous
•12:30 US Apr Real Earnings (MoM) -0.6% forecast, -1.1% previous
•12:30 US Apr CPI, n.s.a (MoM) 1.34% previous
•12:30 US Apr CPI (YoY) 8.1% forecast ,8.5% previous
•12:30 US Apr Core CPI (MoM) 0.4% forecast , 0.3% previous
•12:30 US Apr Core CPI (YoY) 6.0% forecast , 6.5% previous
•12:30 US Apr CPI (MoM) 0.2% forecast , 1.2% previous
•12:30 US Cushing Crude Oil Inventories 1.379M previous
•12:30 US Crude Oil Inventories -0.457M forecast , 1.302M previous
•15:00 US Apr Cleveland CPI (MoM) 0.5% previous
Looking Ahead - Economic events and other releases (GMT)
•No significant events
Fxbeat
EUR/USD: The euro steadied against the U.S. dollar on Wednesday ahead of keenly awaited U.S. inflation data that will offer a guide to how aggressively the Federal Reserve will raise rates. The euro rose 0.24% to $1.05560, having mostly traded sideways since plumbing a more than five-year low at $1.04695 at the end of last month. The common currency remains under pressure from the bullish dollar as well as fears that the war in Ukraine and rising energy prices could tilt the euro zone into recession later this year. Immediate resistance can be seen at 1.0557 (5DMA), an upside break can trigger rise towards 1.0597 (38.2%fib).On the downside, immediate support is seen at 1.0490(23.6%fib), a break below could take the pair towards 1.0422 (Lower BB).
GBP/USD: The British pound strengthened on Wednesday as dollar dipped as investors awaited monthly U.S. inflation data that could provide clues on the Federal Reserve's monetary policy stance. U.S. consumer price data, due at 1230 GMT, could give an indication of whether the Fed will raise rates even more aggressively to combat inflation. The Fed last week raised its target for overnight bank-to-bank lending by a half a percentage point, and Chair Jerome Powell said two more such hikes are likely at the U.S. central bank’s coming policy meetings. There has also been speculation in markets the Fed will need to go in for a massive 75 basis point hike at one meeting. Sterling rose 0.20% to $1.2360 after touching a 22-month low of $1.2262 at the start of the week. Immediate resistance can be seen at 1.2391(38.2%fib), an upside break can trigger rise towards 1.2433(5DMA).On the downside, immediate support is seen at 1.2269 (23.6%fib), a break below could take the pair towards 1.2187(Lower BB).
USD/CHF: The dollar dipped against Swiss franc on Wednesday as investors waited for fresh U.S. inflation data to anticipate how aggressively the Federal Reserve will have to tighten monetary policy to keep rising prices in check. The dollar index, which measures the greenback against six main peers, fell 0.3% to 103.65, below the two-decade high of 104.19 reached at the start of the week.The Fed last week raised interest rates by 50 basis points and Chair Jerome Powell said two more such hikes are likely at the U.S. central bank's coming policy meetings. Immediate resistance can be seen at 0.9968(23.6 % fib), an upside break can trigger rise towards 1.002(Higher BB).On the downside, immediate support is seen at 0.9871(Daily low), a break below could take the pair towards 0.9823(38.2 % fib ).
USD/JPY: The dollar edged lower against yen on Wednesday as investors wait for key U.S. inflation data that could impact the Federal Reserve’s monetary policy. U.S. consumer price data, due at 1230 GMT, could give an indication of whether the Fed will raise rates even more aggressively to combat inflation. The monthly CPI data will be closely watched for any impact it could have on the U.S. central bank’s rate-hike plans. Last week, the U.S. Federal Reserve raised its benchmark overnight interest rate by half-a-percentage point as it moves to unwind ultra-easy pandemic-era monetary policy and attempts to combat soaring inflation. Strong resistance can be seen at 130.65(23.6%fib), an upside break can trigger rise towards 131.88 (Higher BB).On the downside, immediate support is seen at 128.78(Daily low), a break below could take the pair towards 128.15(38.2%fib).
Equities Recap
European shares extended their bounce on Wednesday ahead of inflation data in the United States that will offer a guide to how aggressively the Federal Reserve will raise rates.
At (GMT 09:32),UK's benchmark FTSE 100 was last trading up at 1.14 percent, Germany's Dax up by 0.99 percent, France’s CAC finished was up by 1.80 percent.
Commodities Recap
Gold prices clawed back from a three-month low on Wednesday as the dollar and Treasury yields weakened, ahead of key U.S. monthly inflation data that could influence the Federal Reserve’s monetary policy stance and impact demand for bullion.
Spot gold was up 0.6% at $1,849.245 per ounce, as of 0729 GMT, after hitting its lowest since Feb. 11 earlier in the session. U.S. gold futures firmed 0.2% to $1,846.40.
Oil rose on Wednesday after plunging nearly 10% in the last two sessions, buoyed by supply concerns as the European Union works on gaining support for a Russian oil embargo and flows of Russian gas to Europe through a key transit point in Ukraine dried up.
Brent crude was up $2.86, or 2.8%, to $105.32 a barrel at 0815 GMT, while U.S. West Texas Intermediate crude climbed $2.53, or 2.5%, to $102.29.
