Market Roundup
•German Jan Car Registration (MoM) -11.7%, -1.6%previous
• German Jan Car Registration (YoY) 19.1%,-23.0% previous
•French Jan Car Registration (MoM) -32.4%, 18.5% previous
• French Car Registration (YoY) 9.2%,14.5% previous
• EU Dec Current Account n.s.a. 42.7B ,31.7B previous
• EU Dec Current Account 32.0B,20.3B forecast,24.6B previous
Looking Ahead Economic Data(GMT)
• 13:30 Canada Jan CPI (MoM) 0.4% forecast, -0.3% previous
• 13:30 Canada Jan Trimmed CPI (YoY) 3.6% forecast,3.7% previous
• 13:30 Canada Jan Median CPI (YoY) 3.6% forecast, 3.6% previous
• 13:30 Canada Jan Core CPI (YoY) 2.6% previous
• 13:30 Canada Jan CPI (YoY) 3.3% forecast, 3.4% previous
• 13:30 Canada Jan Core CPI (MoM) -0.5% previous
• 13:30 Canada Jan Common CPI (YoY) 3.8% forecast, 3.9% previous
• 15:00 US Jan Leading Index (MoM) -0.3% forecast,-0.1% previous
•15:00 Globa lDairyTrade Price Index 4.2%
•16:30 US 3-Month Bill Auction 5.230% previous
•16:30 US 6-Month Bill Auction 5.065% previous
Looking Ahead Events And Other Releases(GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro strengthened on Tuesday as dollar dipped ahead of Fed's January policy meeting which is due on Wednesday. Hotter-than-expected U.S. consumer prices and producer prices data last week dashed hopes around a rate cut in March. Markets are currently pricing in a 77% chance of a cut in June, according to the CME Fed Watch Tool. The main data release for Tuesday on a fairly quiet calendar was ECB numbers that showed the annual growth in negotiated wages across the euro area slowed to 4.5% in the final quarter of 2023, down slightly from a record high of 4.7% in the third quarter.The ECB has singled out wages as the single biggest risk to its 1-1/2 year crusade against inflation, in which it raised key interest rates to record highs. Immediate resistance can be seen at 1.0805(Daily high), an upside break can trigger rise towards 1.0848 (23.6%fib).On the downside, immediate support is seen at 1.0771(38.2%fib), a break below could take the pair towards 1.0705 (50%fib).
GBP/USD: The pound gained marginally on Tuesday as investors awaited further impetus from survey data on Thursday. The latest purchasing managers' index data, which relies on surveys, is set to be released on Thursday. It will offer insights into the current state of the UK economy for the month of February. Bank of England Deputy Governor Ben Broadbent said interest rate cuts during 2024 were possible but the timing was dependent on an unclear outlook for inflation.The BoE's most recent forecast for inflation to fall certainly doesn't rule out a policy easing at some point this year, Broadbent said in an annual report to parliament's Treasury Committee published on Tuesday. Sterling was up 0.1% at $1.2604 against dollar. Immediate resistance can be seen at 1.2631(Feb 19th high), an upside break can trigger rise towards 1.2659 (23.6%fib).On the downside, immediate support is seen at 1.2567(38.2%fib), a break below could take the pair towards 1.2497(50%fib).
USD/CHF: The dollar was little changed against the Swiss franc on Tuesday as investors awaited the minutes of the last U.S. Federal Reserve policy meeting for more clues on its interest rate cut timing. Investors will closely watch the release of the (Fed) minutes as it indicates the potential for interest rate cuts later in the year.Despite remarkable progress on inflation, Fed Bank of San Francisco President Mary Daly said "there is more work to do to ensure stable prices, while another Fed official cautioned against delaying rate cuts for too long. The dollar index , which tracks the performance of the U.S. currency against six others, eased 0.1% to 104.22. Immediate resistance can be seen at 0.8846(23.6%fib), an upside break can trigger rise towards 0.8874(Higher BB).On the downside, immediate support is seen at 0.8793(Feb 19th low), a break below could take the pair towards 0.8749(38.2%fib).
USD/JPY: The dollar was little changed against yen on Tuesday as investors grew less certain Japan's era of ultra-low rates will end any time soon given the country is in recession. Japanese finance minister Shunichi Suzuki said on Tuesday authorities were closely watching FX moves with a high sense of urgency, a phrase he has used previously, and stated the yen exchange rate was set by a number of factors.The yen has lost 7% in value in 2024 alone, having weakened past the 150-level against the dollar on Feb. 13. In the past, traders have viewed 150 as a line in the sand for the Bank of Japan and the Ministry of Finance that could trigger intervention, such as was the case in late 2022. The dollar was last trading flat at 150.09. Strong resistance can be seen at 150.78 (Higher BB) an upside break can trigger rise towards 151.56(23.6%fib).On the downside, immediate support is seen 149.79(38.2%fib), a break below could take the pair towards 149.00(Psychological level )
Equities Recap
European shares teetered just shy of all-time highs on Tuesday, while euro zone wage data did little to jolt struggling government bonds, and Asian shares slipped as a record rate cut in China failed to excite investors.
At (GMT 13:15 ),UK's benchmark FTSE 100 was last trading up at 0.17 percent, Germany's Dax was down by 0.13 percent, France’s CAC finished was up by 0.28 percent.
Commodities Recap
Gold ticked higher on Tuesday as the U.S. dollar pulled back, with investors keenly awaiting the minutes of the last U.S. Federal Reserve policy meeting to gauge the timing of interest rate cuts.
Spot gold was up 0.3% at $2,022.80 per ounce as of 0919 GMT. U.S. gold futures rose 0.5% at $2,034.70 per ounce.
Oil prices fell on Tuesday, with an uncertain outlook for global demand knocking value off crude futures contracts, despite some risk premium from the Israel-Hamas conflict.
Brent futures dipped 80 cents or 0.96% to $82.76 a barrel by 1255 GMT.
U.S. West Texas Intermediate (WTI) crude for April delivery fell 92 cents, or 1.17%, to $77.54 a barrel, after earlier paring $1. The March WTI contract lost 51 cents or 064% to $78.68 a barrel ahead of its expiry during the session.
