Market Roundup
• German Factory Orders (MoM) (Jan): -11.1%, -4.2% forecast, 6.4% previous.
• German Industrial Production (MoM) (Jan): -0.5%, 1.0% forecast, -1.0% previous.
• German Industrial Production (YoY) (Jan): -1.09%, 0.44% previous.
• Swiss SECO Consumer Climate (Feb): -30, -29 forecast, -30 previous.
• Foreign Reserves USD (MoM) (Feb): 416.1B, 417.0B previous.
• EU Sentix Investor Confidence (Mar): -3.1, -3.1 forecast, 4.2 previous.
Looking Ahead Economic Data (GMT)
• 14:00 French 12-Month BTF Auction 2.097% previous.
• 14:00 French 3-Month BTF Auction 2.030% previous.
• 14:00 French 6-Month BTF Auction 2.065% previous.
• 14:00 US CB Employment Trends Index (Feb) 105.06 previous.
• 15:00 US Consumer Inflation Expectations (Feb) 3.1 previous.
Looking Ahead Events And Other Releases (GMT)
Currency Forecast
EUR/USD : The euro edged initially dipped on Monday as the inflationary jolt from surging oil prices threatened to raise living costs and interest rates around the globe, while investors desperate for liquidity fled to the U.S. dollar. Investor jitters over soaring energy prices meant a wave of global stock and bond market selling which hung over the Wall Street open with S&P 500 futures ESc1 and Nasdaq futures NQc1 both down roughly 1%.Crude oil futures in London and New York soared almost 30% to nearly $120 a barrel, one of the biggest one-day jumps on record in early trading, threatening to raise costs of products from gasoline to jet fuel. Immediate resistance can be seen at 1.1574(Daily high), an upside break can trigger rise towards 1.1608(38.2%fib).On the downside, immediate support is seen at 1.1509(Lower BB), a break below could take the pair towards 1.1474(23.6%fib).
GBP/USD: The pound tumbled on Monday as investors rushed to the safety of the U.S. dollar and ditched the currencies of countries most exposed to rising energy costs, as the U.S.-Iran war sent oil prices surging to $120 a barrel. Oil prices jumped more than 25% to their highest levels since mid-2022 on Monday, with the global benchmark Brent crude touching $119.50 per barrel.Major Gulf producers cut supplies and shipping disruptions rattled the market as the U.S.-Iran war showed few signs of slowing down. The Financial Times reported that G7 finance ministers plan to discuss a possible release of petroleum from reserves, helping temper some of the market moves. Brent crude was last up 16% at $107.80 a barrel.Immediate resistance can be seen at 1.3328(38.2%fib), an upside break can trigger rise towards 1.3489(50%fib)).On the downside, immediate support is seen at 1.3118(Lower BB), a break below could take the pair towards 1.3125(23.6%fib).
AUD/USD: The Australian dollar edged higher on Monday as the war in the Middle East triggered a surge in oil prices and dash to safety.Oil prices surged sharply as limited storage capacity forced producers to consider output cuts, tightening supply expectations. With no clear end to the tensions in the Middle East and oil tankers still avoiding the Strait of Hormuz, investors are bracing for a prolonged period of elevated energy prices.Geopolitical tensions intensified after Donald Trump called for Iran’s “unconditional surrender,” while Ali Khamenei’s son was reportedly chosen as a potential successor, signaling a continuation of hardline policies.Growing concerns over a potential global recession and a sharp energy price shock are expected to keep the Australian dollar under pressure in the near term. Immediate resistance can be seen at 0.7030(38.2%fib), an upside break can trigger rise towards 0.7137(38.2%fib).On the downside, immediate support is seen at 0.6940(38.2%fib), a break below could take the pair towards 0.6900(Psychological level)
USD/JPY: The US dollar retreated slightly on Monday as investors, spooked by the impact of surging oil prices on global inflation and economic growth, turned risk-averse and cashed in on some of their most profitable trades.. Japan is particularly vulnerable due to its heavy reliance on Middle East energy imports, unlike the United States which is less dependent.Markets remain volatile, with analysts warning of possible stagflation risks in Japan, despite relatively strong recent data. Indicators show Japanese wages rose in January, large pay hikes are expected in April, and bank lending continued to grow in February, pointing to underlying economic momentum despite rising risks. Immediate resistance can be seen at 158.29(Higher BB) an upside break can trigger rise towards 160.00(Psychological level) .On the downside, immediate support is seen at 156.72(38.2%fib) a break below could take the pair towards 155.44 (SMA 20).
Equities Recap
European shares tumbled to their lowest level in more than two months on Monday, as a sharp surge in oil prices exacerbated inflation fears and the U.S.-Israeli war with Iran showed no signs of easing.
At GMT (13:20) UK's benchmark FTSE 100 was last trading down at 0.86 percent, Germany's Dax was down by 0.89 percent, France’s CAC finished was down by 1.64 percent.
Commodities Recap
Gold fell more than 1% on Monday as a stronger dollar and expectations of higher interest rates weighed on prices amid inflation concerns linked to the Middle East conflict.
Spot gold was down 1.5% at $5,092.89 per ounce at 9:11 a.m. ET (1311 GMT). U.S. gold futures for April delivery were down 1.1% to $5,101.00.
Oil prices surged above $119 a barrel on Monday, reaching the highest levels since mid-2022, as supply cuts by major producers and fears of prolonged shipping disruptions intensified amid the expanding U.S.-Israeli war with Iran.
Brent crude futures were up $12.77, or 14%, at $105.46 per barrel at 1126 GMT, while U.S. West Texas Intermediate (WTI) crude futures were up $12.66, or 14%, at $103.56.
