Market Roundup
• EU Current Account (Sep) 37.0B, 27.0B forecast, 31.5B previous
• EU Current Account n.s.a. (Sep) 51.5B, 38.8B previous
•: Swiss Trade Balance (Oct) 8.063B, 4.250B forecast, 4.942B previous
• Spanish Consumer Confidence (Oct) 79.6, 84.8 previous
• EU Core CPI (YoY) (Oct) 2.7%, 2.7% previous
• EU Core CPI (MoM) (Oct) 0.2%, 0.2% previous
• EU CPI (YoY) (Oct) 2.0%, 2.0% previous
• EU CPI (MoM) (Oct) 0.3%, 0.3% forecast, -0.1% previous
• EU CPI ex Tobacco (MoM) (Oct) 0.3%, -0.1% previous
• EU CPI ex Tobacco (YoY) (Oct) 1.9%, 1.6% previous
• EU CPI, n.s.a (Oct) 127.03, 126.60 previous
• EU HICP ex Energy & Food (YoY) (Oct) 2.7%, 2.7% previous
• EU HICP ex Energy and Food (MoM) (Oct) 0.3%, 0.0% previous
Looking Ahead Economic Data (GMT)
•13:30 US Building Permits (Oct) 1.440M forecast, 1.425M forecast
•13:30 US Building Permits (MoM) (Oct) -3.1% previous
•13:30 US Housing Starts (MoM) (Oct) -0.5% previous
•13:30 US Housing Starts (Oct) 1.340M forecast, 1.354M previous
•13:30 Canada Common CPI (YoY) (Oct) 2.1% forecast, 2.1% previous
•13:30 Canada Core CPI (YoY) (Oct) 1.6%
•13:30 Canada Core CPI (MoM) (Oct) 0.0%
•13:30 Canada CPI (YoY) (Oct) 1.9% forecast, 1.6% previous
•13:30 Canada CPI (MoM) (Oct) 0.3% forecast, -0.4% previous
•13:30 Canada Median CPI (YoY) (Oct) 2.2% forecast, 2.3% previous
•13:30 Canada Trimmed CPI (YoY) (Oct) 2.4%, 2.4% previous
•13:55 US Redbook (YoY) 4.8% previous
•16:30 US Atlanta Fed GDPNow (Q4) 2.5%, 2.5% previous
Looking Ahead Events And Other Release(GMT)
•16:45 German Buba Balz Speaks
•18:10 Fed Schmid Speaks
Currency Forecast
EUR/USD: The euro dipped on Tuesday as investors flocked to safe-haven assets after President Vladimir Putin updated Russia's nuclear doctrine amid escalating tensions with the United States over Ukraine. Putin said Russia could consider using nuclear weapons if it was subject to a conventional missile assault supported by a nuclear power, after the United States allowed Ukraine to fire American-made long-range missiles deep into Russia. Investors are also waiting for the euro area’s negotiated wage figures due on Wednesday and regional purchasing manager surveys on Friday, which could be crucial for the European Central Bank's policy decision in December. The euro dropped 0.4% to $1.0553. It hit $1.0496 last week, its lowest since early October 2023. Immediate resistance can be seen at 1.0611(38.2%fib), an upside break can trigger rise towards 1.0671(50%fib).On the downside, immediate support is seen at 1.0538`(23.6%fib), a break below could take the pair towards 1.0521(Lower BB)
GBP/USD: The pound slipped lower as investors flocked to safe-haven assets following a warning from Russia about its updated nuclear doctrine. President Vladimir Putin on Tuesday raised the stakes, lowering the threshold for a nuclear strike just days after reports suggested the Biden administration had authorized Ukraine to fire American missiles deep into Russian territory. In response, investors shifted their focus to safe-haven currencies, with analysts suggesting that markets had previously underestimated the growing geopolitical risks. The U.S. dollar index a measure of the unit's value relative to a basket of foreign currencies rose 0.25% to 106.46. The pound was down 0.4% versus the greenback at $1.2628. Immediate resistance can be seen at 1.2683(SMA 5), an upside break can trigger rise towards 1.2723(38.2%fib).On the downside, immediate support is seen at 1.2592 (23.6%fib), a break below could take the pair towards 1.2515(My 14th low)
AUD/USD: The Australian edged lower on Tuesday as escalating geopolitical tensions, triggered by Russia's warning on its updated nuclear doctrine, led investors to move away from risky assets and seek safe haven assets. The Kremlin stated that the goal of its updated nuclear doctrine was to ensure potential adversaries recognize the inevitability of Russian retaliation in the event of an attack. Meanwhile, the Reserve Bank of Australia offered indirect support by reiterating that interest rates were unlikely to be cut soon, and might even have to be raised under some scenarios. The Australian dollar last traded at $0.6491. Immediate resistance can be seen at 0.6529(SMA 5), an upside break can trigger rise towards 0.6550(Nov 13th high).On the downside, immediate support is seen at 0.6441(23.6%fib), a break below could take the pair towards 0.6389(April 16th low).
USD/JPY: The dollar eased against the yen on Tuesday as Japanese authorities issued stronger verbal warnings about excessive foreign exchange fluctuations. Japanese Finance Minister Katsunobu Kato reiterated that the government would continue to respond appropriately to sharp currency movements, despite the yen's recent brief rebound. In Tokyo, there is a sense that the Ministry of Finance is biding its time, waiting for the most opportune moment to act, especially as the U.S. dollar remains broadly strong, which diminishes the impact of any intervention. Such action could align with a potential Bank of Japan rate hike in December if the yen remains weak. The Japanese yen, long seen as a safe haven at times of stress, rallied 0.6% to 153.69 per dollar. Immediate resistance can be seen at 155.20(Nov 18th high) an upside break can trigger rise towards 156.77(23.6%fib). On the downside, immediate support is seen at 154.02(5SMA) a break below could take the pair towards 153.97(38.2%fib).
Equities Recap
Europe's main stock index fell to a three-month low on Tuesday, as heightened geopolitical tensions following Russia's warning on its updated nuclear doctrine prompted investors to shift from risky assets to safe havens.
At (GMT 12:35),UK's benchmark FTSE 100 was last trading down at 0.35 %percent, Germany's Dax was down by 0.99 %percent, France’s CAC was down by 1.15% percent.
Commodities Recap
Gold prices climbed for a second consecutive session on Tuesday, reaching a one-week high as investors are waiting for comments from Federal Reserve officials for more clarity on the outlook for interest rate cuts.
Spot gold rose 0.9% to $2,634.78 per ounce by 1111 GMT, the highest since Nov. 11. Prices gained 2% on Monday, recovering from a two-month low hit on Thursday. U.S. gold futures added 0.9% to $2,638.70.
Oil prices slipped on Tuesday, weighed down by the restart of production at Norway's Johan Sverdrup oilfield. However, the decline was limited as investor caution grew over the potential escalation of the Russia-Ukraine war.
Brent crude futures were down 45 cents, or 0.6%, to $72.85 a barrel by 0915 GMT, while U.S. West Texas Intermediate crude futures slipped by 46 cents, or 0.7%, to $68.70.
