Market Roundup
•UK Aug Public Sector Net Borrowing 10.76B,9.80B forecast, 3.48B previous
•UK Aug Public Sector Net Cash Requirement 2.468B, -7.474B previous
• French Sep Business Survey 99, 97 forecast, 96 previous
•UK Sep BoE Interest Rate Decision 5.25%, 5.50% forecast,5.25% previous
•UK Sep BoE MPC vote hike 4, 7 forecast, 8 previous
•UK Sep BoE MPC vote unchanged 5 ,2 forecast,1 previous
Looking Ahead Economic Data (GMT)
•12:30 US Jobless Claims 4-Week Avg. 224.50K previous
•12:30 US Continuing Jobless Claims 1,695K forecast, 1,688K previous
•12:30 US Initial Jobless Claims 225K forecast, 220K previous
•12:30 Canada Aug New Housing Price Index (MoM) 0.0% forecast, -0.1% previous
•12:30 US Current Account (Q2) -221.0B forecast,-219.3B previous
•12:30 US Sep Philadelphia Fed Manufacturing Index -0.7 forecast,12.0 previous
•12:30 US Sep Philly Fed Employment -6.0 previous
•12:30 US Sep Philly Fed Prices Paid 20.80 previous
•12:30 US Sep Philly Fed New Orders 16.0 previous
•12:30 US Sep Philly Fed Business Conditions 3.9 previous
•12:30 US Sep Philly Fed CAPEX Index -4.50 previous
•14:00 US Aug Existing Home Sales 4.10M forecast, 4.07M previous
•14:00 US Aug Existing Home Sales (MoM) -2.2% previous
•14:00 US Aug US Leading Index (MoM) -0.5% forecast,-0.4% previous
•15:30 US 4-Week Bill Auction 5.285% previous
•15:30 US 8-Week Bill Auction 5.295% previous
•15:30 US 10-Year TIPS Auction 1.495% previous
•20:30 US Fed's Balance Sheet 8,099B previous
Looking Ahead Events And Other Releases(GMT)
•14:00 ECB President Lagarde Speaks
Currency Forecast
EUR/USD: The euro dipped on Thursday as the U.S. dollar rose after the Federal Reserve signalled another rate hike this year and lesser chances of monetary policy easing through 2024. The U.S. central bank held interest rates steady but stiffened its hawkish stance, with a further rate increase projected by the end of the year and monetary policy kept significantly tighter through 2024 than previously expected.Fed Chair Jerome Powell said officials will proceed “meeting by meeting on rates and we are prepared to raise rates further if appropriate. The dollar index , which measures the currency against a basket of rivals, rose as high as 105.59 . Immediate resistance can be seen at 1.0663(Daily high), an upside break can trigger rise towards 1.0702(38.2%fib).On the downside, immediate support is seen at 1.0616(23.6%fib), a break below could take the pair towards 1.0584(Lower BB).
GBP/USD: The pound held near three-month lows on Wednesday after Bank of England on Thursday left interest rates unchanged, breaking a long run of rate rises. The Bank of England halted its long run of interest rate increases on Thursday as the British economy slowed, but it said it was not taking a recent fall in inflation for granted.A day after a surprise slowing in Britain's fast pace of price growth, the BoE's Monetary Policy Committee voted by a narrow margin of 5-4 to keep Bank Rate at 5.25%.Four members - Jon Cunliffe, Megan Greene, Jonathan Haskel and Catherine Mann - voted to raise rates to 5.5%.It was the first time since December 2021 that the BoE did not increase borrowing costs.. Immediate resistance can be seen at 1.2356(38.2%fib), an upside break can trigger rise towards 1.2403(5DMA).On the downside, immediate support is seen at 1.2245 (23.6%fib), a break below could take the pair towards 1.2221(Lower BB).
USD/CHF: The U.S. dollar rose against Swiss franc on Thursday after the Swiss National Bank (SNB) kept its policy interest rate unchanged .Swiss National Bank held out the prospect of further interest rate hikes later this year after it surprised markets on Thursday by pausing its current cycle of increases.The SNB held its policy interest rate unchanged at 1.75%, noting that inflation has ebbed lower in Switzerland, but said a further tightening cannot be ruled out. The announcement came after Swiss inflation came in at 1.6% in August, within the SNB's target range of 0-2%, and sent the Swiss franc tumbling as much as 1% against the euro and the dollar - its biggest daily drop against the euro since the banking turmoil in March. Immediate resistance can be seen at 0.9061 (23.6%fib), an upside break can trigger rise towards 0.9080(Higher BB).On the downside, immediate support is seen at 0.8996(38.2%fib), a break below could take the pair towards 0.8963(9DMA).
USD/JPY: The dollar dipped against yen on Thursday after Japan's top currency diplomat warned of intervention. Japan won't rule out any options in addressing excess volatility in currency markets, the government's top spokesperson said on Thursday. Chief Cabinet Secretary Hirokazu Matsuno said he hoped the Bank of Japan, holding a two-day policy meeting that ends on Friday, takes "appropriate" policy towards achieving its 2% inflation target. Matsuno's remarks echo those by top currency diplomat Masato Kanda, who told reporters on Wednesday the authorities won't rule out any options if excessive moves persist.Latest verbal intervention underscores policymakers concerns about a persistently weak yen, which inflates the cost of living for households through higher import bills and businesses that rely on imports of raw materials. Strong resistance can be seen at 148.12(23.6%fib) an upside break can trigger rise towards 148.50 ( Higher BB).On the downside, immediate support is seen 146.41 (5DMA), a break below could take the pair towards 146.56(38.2%fib).
Equities Recap
European shares fell on Thursday, tracking overnight losses on Wall Street after the U.S. Federal Reserve signalled higher-for-longer interest rates, while investors as digested policy decision from the Bank of England.
At (GMT 12:20 ),UK's benchmark FTSE 100 was last trading down at 0.38 percent, Germany's Dax down down by 1.34 percent, France’s CAC was down by 1.66 percent.
Commodities Recap
Gold extended its decline on Thursday, weighed by the surge in the U.S. dollar and U.S. bond yields after the Federal Reserve hardened its hawkish posture on interest rates.
Spot gold shed 0.4% to $1,922.30 per ounce by 0907 GMT, having briefly touched its highest since Sept. 1 before closing lower in the previous session.U.S. gold futures eased 1.2% to $1,942.90.
Oil prices fell on Thursday, after posting the largest decline in a month in the previous session, as the U.S. Federal Reserve held rates but signalled potential future hikes, offsetting the impact of drawdowns in U.S. crude stockpiles.
Brent futures for November delivery were down 73 cents, or 0.78%, to $92.80 a barrel by 1140 GMT. U.S. West Texas Intermediate crude (WTI) fell 63 cents, or 0.7%, to $89.03, the lowest since Sept. 14. Both benchmarks had fallen more than $1 earlier on Thursday.
