FxWirePro: Forex Weekly Update

The US dollar index lost its shine after weak US PCE data. The PCE index surges 2.6% YoY in Nov, below market expectations of 2.8%. The Core PCE rose 3.2% in the same period from 3.4% in Oct. came to 4.9% for the third quarter, below the estimate of 5.2%.

US economic calendar previous week

US Philly Fed manufacturing Index - below estimate (negative for US Dollar)

US CB consumer confidence - above forecast ( Positive for the US dollar)

US GDP - below estimate (negative for the US dollar)

US durable goods orders - positive (positive for the US dollar)

  According to the CME Fed watch tool, the probability of a 25 bpbs rate cut in  Jan increased to 16.5% from 8.3% a week ago.

 The US 10-year yield is trading flat despite weak US PCE. The US 10 and 2-year spread narrowed to -45% from -53.6%.

Major resistance- 102.65/103.20

Major support- 101.70/101.

EURUSD-

EURUSD is trading flat due to the holiday mood.  Most European markets to remain closed today due to Boxing Day.

European economic data

Eurozone CPI - Weak (Negative for Euro)

German PPI- Below estimate (Weak for Euro)

Major resistance-1.1030,1.1070

Major support- 1.0960,1.0880

Yen-

The yen recovered slightly after weak US PCE data.

Major Resistance- 143,144

Major support- 141.80,140.70

Canadian Dollar

The Canadian dollar gained strength after upbeat Canada's CPI data. It came unchanged at 3.1% yoy in Nov vs exp 2.9%.

Major Resistance- 1.3300,1.3380

Major support- 1.3200, 1.31500

Economic calendar -

Dec 27th, 2023, US Richmond Manufacturing Index (3 pm GMT)

Dec 28th, 2023, US pending home sales (3 PM GMT)