Market Roundup
• Dollar firms against yen after four-day decline
• Investors focus on U.S. CPI, ECB decision
• Yuan slips on deflation concerns
• EU Sep Sentix Investor Confidence -15.4,-12.4 forecast, -13.9 previous
Looking Ahead Economic Data (GMT)
•13:00 French 12-Month BTF Auction 2.997% previous
•13:00 French 3-Month BTF Auction 3.462% previous
•13:00 French 6-Month BTF Auction 3.308% previous
•14:00 US Aug CB Employment Trends Index 109.61 previous
•14:00 US Total Vehicle Sales 15.40M forecast, 15.80M previous
•14:00 US July Wholesale Inventories (MoM) 0.3% forecast,0.2% previous
•14:00 US Jul Wholesale Trade Sales (MoM) -0.6% previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro slipped against the dollar on Monday as investors awaited a series of economic data releases and anticipated a European Central Bank (ECB) interest rate cut later in the week. The ECB is expected to reduce rates by 25 basis points to 3.50%, following a similar cut in July that marked the beginning of its rate-cutting cycle. The focus will be on the ECB's rate decision on Thursday and the subsequent commentary from ECB President Christine Lagarde, particularly regarding the potential for additional cuts in October and December.Traders will also be looking for hints from several ECB members who are scheduled to speak at various events throughout the week. The euro dipped 0.3% to $1.1049 , having briefly been as high as $1.1155 on Friday. Immediate resistance can be seen at 1.1118(38.2%fib), an upside break can trigger rise towards 1.1185(Aug 20th high).On the downside, immediate support is seen at 1.1039(50%fib), a break below could take the pair towards 1.0958 (61.8%fib).
GBP/USD: Sterling slipped lower against the dollar on Monday as investors awaited key labour market data later in the week. Investors are focussed on key labour market data and gross domestic product figures out of the country this week, for more clues on the Bank of England's stance on further interest rate cuts this year. The British central bank is widely expected to hold rates at its meeting later this month, while the European Central Bank is expected to cut at its meeting this week.Data out of the U.S. fanned worries about growth in the world's largest economy, and left investors divided on the trajectory of the Federal Reserve's policy easing cycle, dampening sentiment across global markets. The pound was about 0.09% lower at $1.3131.Immediate resistance can be seen at 1.3140(Daily high), an upside break can trigger rise towards 1.3180(38.2%fib ).On the downside, immediate support is seen at 1.3075(50%fib), a break below could take the pair towards 1.2980(61.8%fib).
AUD/USD: The Australian dollar declined on Monday as greenback strengthened ahead to upcoming U.S. inflation data after Friday's mixed payrolls report sparked uncertainty about the size of a Federal Reserve rate cut next week. Friday's highly anticipated U.S. jobs data failed to offer clarity to traders on the question of whether the Fed would deliver a regular 25 basis point rate cut or an outsized 50 bps one at its Sept. 17-18 policy meeting .Focus turned to Wednesday's U.S. inflation report as the next main indicator that could alter market pricing for the Fed's September meeting. Immediate resistance can be seen at 0.6691(Daily high), an upside break can trigger rise towards 0.6727(23.6%fib).On the downside, immediate support is seen at 0.6653(50%fib), a break below could take the pair towards 0.6596(61.8%fib).
NZD/USD weakened as the greenback strengthened amid ongoing uncertainty about the size of the Federal Reserve's anticipated rate cut this month. Additionally, economic weakness in China is also exerting pressure on kiwi dollar due to New Zealand's economic dependence on the Chinese market. Top of FormBottom of Form Looking Ahead this week’s economic calendar for Australia and New Zealand is light. Reserve Bank of Australia Assistant Governor Sarah Hunter will give a speech on Wednesday, and New Zealand will release secondary data on migration and food prices. Immediate resistance can be seen at 0.6184(38.2%fib), an upside break can trigger rise towards 0.6226 (Sep 5th hgih).On the downside, immediate support is seen at 0.6134(50%fib), a break below could take the pair towards 0.6098(61.8%fib).
USD/JPY: The dollar rebounded against the yen on Monday as the U.S. dollar strengthened, driven by ongoing uncertainty about the extent of the Federal Reserve's anticipated interest rate cut later this month.. Last week, a report showed U.S. employment increased less than expected in August, but a drop in the jobless rate to 4.2% suggested the labour market was not falling off a cliff to warrant a half-point cut.Fed Governor Christopher Waller on Friday said he could support back-to-back cuts, or bigger cuts, if the data suggests the need. Dollar was last 0.94% up at 143.57 per yen .Strong resistance can be seen at 143.53 (Daily high), an upside break can trigger rise towards 144.64 (38.2%fib). On the downside, immediate support is seen at 142.12(23.6%fib), a break below could take the pair towards 141.32 (Lower BB).
Equities Recap
European shares began the week on a positive note after the benchmark index saw its worst day in more than a year on Friday .
UK's benchmark FTSE 100 was last up by 0.74 percent, Germany's Dax was last up by 0.73 percent, France’s CAC was last up by 0.68 percent.
Commodities Recap
Gold prices dipped on Monday as the dollar ticked higher, while investors looked towards this week's U.S. inflation data to gauge how far the Federal Reserve will cut interest rates.
Spot gold fell 0.2% to $2,491.11 per ounce by 0841 GMT. U.S. gold futures edged 0.2% lower to $2,520.30.
Oil futures surged by around 1% on Monday as a potential hurricane approaching the U.S. Gulf Coast helped prices recover some of the heavy losses from the previous week.
Brent crude rose 67 cents, or 0.94%, to $71.73 a barrel by 0901 GMT while West Texas Intermediate crude futures were up 68 cents, or 1%, at $68.35.
