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Europe Roundup: Sterling rises above $1.37 for first time since 2018, European shares rise,Gold gains, Oil above $56 on U.S. stimulus hopes ahead of Biden inauguration-January 20th,2021

Market Roundup

•Gold at $2,000/oz is still achievable – economist

•U.S. Treasury yields inch lower

• German Dec PPI (MoM)  0.8%, 0.3% forecast, 0.2% previous

• German Dec Core CPI MoM (MoM)  0.3%, 0.2% forecast, -0.1% previous

•UK Dec PPI Input (MoM) 0.8%,0.7% forecast, 0.2% previous

•UK Dec PPI Output (MoM)  0.3%, 0.2% forecast, 0.2% previous

•UK Dec CPI (YoY)  0.6%,0.5% forecast, 0.3% previous

•UK Dec CPI (MoM)  0.3%,0.2% forecast, -0.1% previous

•EU Dec Core CPI (YoY)  0.2%,0.2% forecast, 0.2% previous

•EU Dec CPI (MoM)  0.3%, 0.3% forecast, -0.3% previous

•EU Dec CPI (YoY)  -0.3%,-0.3% forecast, -0.3% previous

Looking Ahead - Economic Data (GMT) 

•13:30 Canada Median CPI (YoY) 1.9% previous

•13:30 Canada Trimmed CPI (YoY) 1.7% previous

•13:30 Canada Dec CPI (MoM)   0.1% previous

•13:30 Canada CPI (YoY)  1.0%  forecast, 1.0% previous

•13:30 Canada Dec Core CPI (YoY)  1.5% previous

•13:30 Canada Dec Core CPI (MoM)  0.2% previous

•13:30 US Redbook (YoY) 2.1%

•13:55 US Redbook (MoM) -2.6%

• 15:00 Canada BoC Interest Rate Decision 0.25%forecast,0.25% previous

•15:00 US NAHB Jan Housing Market Index  

Looking Ahead - Economic events and other releases (GMT)

•15:00 Canada BoC Monetary Policy Report

•16:00 Canada BOC Press Conference

•16:30 U.S. President Biden Speaks

•17:00 UK BoE Gov Bailey Speaks

Fxbeat

EUR/USD: The euro dipped against dollar on Wednesday as risk of extended lockdowns in Europe to combat the spread of COVID-19 weighed on euro. The prospect of longer lockdowns kept investors on edge as German Chancellor Angela Merkel and state premiers agreed to extend a lockdown for most shops and schools until Feb. 14 Immediate resistance can be seen at 1.2137 (38.2%fib), an upside break can trigger rise towards 1.2194(21DMA).On the downside, immediate support is seen at 1.2092 (Daily low), a break below could take the pair towards  1.2057 (50% fib).

GBP/USD: The pound rose against dollar on Wednesday as combination of heightened risk appetite in global markets and upbeat economic data lifted the pound. Inflation data for December showed that prices in the UK picked up by more than expected in December, to a 0.6% annual rate. 0.6.Inflation has been below the Bank of England’s 2% target since mid-2019 and the COVID-19 pandemic pushed it close to zero as the economy tanked. Immediate resistance can be seen at 1.3693 (23.6%fib), an upside break can trigger rise towards 1.3729(Higher BB).On the downside, immediate support is seen at 1.3608(38.2%fib), a break below could take the pair towards 1.3568(21DMA).

USD/CHF: The dollar strengthened against the Swiss franc on Wednesday as the prospect of aggressive fiscal stimulus in the United States bolstered the global outlook. Sentiment was supported by a declaration from Janet Yellen, U.S. President-elect Joe Biden’s nominee for Treasury Secretary, that the government had to “act big” on stimulus. Immediate resistance can be seen at 0.8911 (23.6%fib), an upside break can trigger rise towards 0.8938 (Higher BB).On the downside, immediate support is seen at 0.8887 (38.2% fib), a break below could take the pair towards 0.8866 (50%fib).

USD/JPY: The dollar dipped against the Japanese yen on Wednesday as the greenback dipped after U.S. Treasury Secretary nominee Janet Yellen underscored the need for big stimulus plan to help the US economy recover from the coronavirus pandamic. Yellen at her confirmation hearing on Tuesday urged lawmakers for large coronavirus relief spending, adding that the benefits outweigh the expenses of a higher debt burden.  Strong resistance can be seen at 103.90 (38.2%fib), an upside break can trigger rise towards 104.19 (23.6%fib).On the downside, immediate support is seen at 103.66 (50%fib), a break below could take the pair towards 103.56 (21DMA).

Equities Recap

European stocks rose on Wednesday after chip equipment maker ASML and Swiss luxury group Richemont gave encouraging earnings updates, while investors hoped for a big U.S. fiscal relief package as Joe Biden takes over as the next president.

At (GMT 12:40 ),UK's benchmark FTSE 100 was last trading down at 0.07 percent, Germany's Dax was up by 0.55 percent, France’s CAC was last up by 0.23 percent.

Commodities Recap

Gold prices rose on Wednesday as the dollar weakened after U.S. Treasury Secretary nominee Janet Yellen underscored the need for a huge stimulus to help the economy recover from the coronavirus jolt, bolstering bullion's appeal as an inflation hedge.

Spot gold gained 0.8% to $1,853.80 per ounce by 0719 GMT. U.S. gold futures added 0.7% to $1,852.80.

Oil rose above $56 a barrel on Wednesday, supported by expectations the new U.S. administration will deliver massive stimulus spending that would lift demand, as well as by OPEC curbs and forecasts of a drop in U.S. crude inventories.

Brent crude was up 46 cents, or 0.8%, to $56.36 at 1247 GMT, after a 2.1% gain on Tuesday. U.S. West Texas Intermediate (WTI) crude climbed 61 cents, or 1.2%, to $53.59.

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