Market Roundup
•UK Apr Core PPI Output (YoY) 0.2%,0.1% previous
•UK Apr PPI Input (MoM) 0.6%, 0.4% forecast,-0.1% previous
•UK Apr PPI Input (YoY) -1.6%,-1.2% forecast,-2.5% previous
•UK Apr PPI Output (YoY) 1.1%, 1.2% forecast,0.6% previous
•UK Apr RPI (YoY) 3.3%, 3.3% forecast, 4.3% previous
•UK Apr RPI (MoM) 0.5%,0.5% forecast, 4.3% previous
•UK Apr CPI (YoY) 2.3%, 2.1% forecast, 3.2% previous
•UK Apr Core RPI (MoM) 0.5%,0.5% previous
•UK Apr CPI (MoM) 0.3%,0.2% forecast, 0.6% previous
•UK Apr Car Registration (MoM) -57.7%,274.4% previous
Looking Ahead Economic Data(GMT)
•14:00 US Apr Existing Home Sales (MoM) -4.3% previous
•14:00 US Apr Existing Home Sales 4.21M forecast,4.19M previous
•14:30 US Gasoline Inventories -1.600M forecast,-0.235M previous
•14:30 US EIA Weekly Distillates Stocks -0.100M forecast,-0.045M previous
•14:30 US Crude Oil Imports 0.108M previous
•14:30 US EIA Weekly Refinery Utilization Rates (WoW) 1.9% previous
•14:30 US EIA Refinery Crude Runs (WoW) 0.307M previous
•14:30 US Distillate Fuel Production 0.021M previous
•14:30 US Crude Oil Inventories -2.400M forecast,-2.508M previous
Looking Ahead Events And Other Releases(GMT)
•18:00 US FOMC Meeting Minutes
Currency Forecast
EUR/USD: The euro declined against dollar on Wednesday as investors are awaited Thursday's Euro zone Purchasing Managers' Index (PMI) which could provide further clues about the monetary cycle in the euro area. Investors expect the European Central Bank to start lowering borrowing costs from their current record highs at its upcoming meeting in June. Currently, markets are pricing in around 65 basis points of ECB rate cuts in 2024. The dollar index was 0.21% higher against a basket of currencies at 104.83, bobbing above a five-week low of 104.07 touched last week . Immediate resistance can be seen at 1.0886(23.6%fib), an upside break can trigger rise towards 1.0908(Higher BB).On the downside, immediate support is seen at 1.0830 (38.2% fib), a break below could take the pair towards 1.0796(50% fib).
GBP/USD: The pound jumped on Wednesday after data showed UK inflation neared the Bank of England's target in April, but did not slow as much as expected, leaving the chances of a June rate cut unchanged at around 50%.British consumer prices rose by 2.3% in annual terms in April, slowing from a 3.2% increase in March, the Office for National Statistics said.The Bank of England and economists polled by Reuters had forecast an annual rate of 2.1%.Sterling rose by as much as 0.3% to a new two-month high of $1.27520, and was last trading at $1.2749. Money markets now see only a 13% chance of a rate cut in June . Earlier this week, pricing in derivatives markets suggested traders saw a 55% chance of a first cut coming in June. Immediate resistance can be seen at 1.2755(23.6%fib), an upside break can trigger rise towards 1.2787(Higher BB).On the downside, immediate support is seen at 1.2686(38.2% fib), a break below could take the pair towards 1.2623(50% fib).
USD/CHF: The dollar strengthened against the Swiss franc on Wednesday as investors awaited Federal Reserve meeting minutes for more insight on the central bank's rate path. Minutes of the Fed's May policy meeting are due at 1800 GMT.Lately, economic data has pointed towards a downtrend in inflation, but U.S. central bank policymakers said on Tuesday that the Fed should wait several more months to ensure that inflation really is back on track to its 2% target before cutting interest rates. The Swiss franc was down 0.38% to 0.9144 against dollar.Against a basket of currencies, the dollar was up 0.21% at 104.84.Immediate resistance can be seen at 0.9150 (23.6% fib), an upside break can trigger rise towards 0.9199 (Higher BB).On the downside, immediate support is seen at 0.9101 (Daily low), a break below could take the pair towards 0.9038(50% fib).
USD/JPY: The U.S. dollar strengthened against yen on Wednesday as investors anticipated the release of Federal Reserve meeting minutes, seeking clues about the central bank's future interest rate decisions.Fed Chair Jerome Powell and other officials have dropped what had been explicit guidance about the likelihood of interest rate cuts this year, instead focusing attention on broadly different near-term paths the economy might follow, and their likely reaction to each case, Reuters reported on Wednesday.The Fed minutes may provide more details on the shift in approach. They should confirm its next rate move is still likely down, but policymakers first need more confidence that inflation has resumed its downward trend. Against the yen, the dollar edged up 0.15% to 156.43.Strong resistance can be seen at 156.82 (23.6%fib), an upside break can trigger rise towards 158.06(Higher BB).On the downside, immediate support is seen at 155.25(38.2% fib), a break below could take the pair towards 155.00(Psychological level).
Equities Recap
A record-breaking run in European shares has made them more vulnerable to possible pull-backs in the latter part of 2024, although the region's recovering economy and the start of a rate-cut cycle is seen pushing them back to new peaks in 2025.
UK's benchmark FTSE 100 was last down by 0.68percent, Germany's Dax was last down by 0.24 percent, France’s CAC was last down by 0.63 percent.
Commodities Recap
Gold prices slipped on Wednesday as investors strapped in for minutes from the Federal Reserve's most recent policy meeting for further insights on the timeline for interest rate cuts.
Spot gold eased by 0.3% at $2,413.96 per ounce, as of 1127 GMT. Prices had scaled a record high of $2,449.89 on Monday.U.S. gold futures were down 0.3% at $2,417.60.
Oil prices fell on Wednesday, retreating for a third straight day on expectations that the Federal Reserve might keep U.S. interest rates higher for longer due to sustained inflation, potentially affecting fuel use in the world's largest consumer.
Brent crude futures were down 94 cents, or 1.1%, at $81.94 a barrel, while U.S. West Texas Intermediate crude (WTI) dropped 77 cents, or 1%, to $77.89 by 1223 GMT. Both benchmarks shed more than 1% earlier in the session.
