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Market Roundup
•US Philadelphia Fed Manufacturing Index (Sep) 37.8, 31.3 forecast, 47.4 previous
•US Initial Jobless Claims 196K, 207K forecast, 206K previous
•US Housing Starts (MoM) (Aug) -2.6%, -9.0% previous
•US Building Permits (Aug) 1.394M, 1.400M forecast, 1.433M previous
•US Housing Starts (Aug) 1.275M, 1.320M forecast, 1.309M previous
•US Philly Fed Employment (Sep) 11.8, 27.9 previous
•US Continuing Jobless Claims 1,730K, 1,780K forecast, 1,769K previous
•US Building Permits (MoM) (Aug) -2.7%, 4.3% previous
•US Philly Fed Business Conditions (Sep) 52.9, 73.6 previous
•US Philly Fed New Orders (Sep) 29.2, 30.1 previous
•US Philly Fed Prices Paid (Sep) 48.60, 40.90 previous
•US Philly Fed CAPEX Index (Sep) 37.10, 48.20 previous
•US Jobless Claims 4-Week Avg. 203.25K, 206.00K previous
•Canada RMPI (MoM) (Aug) 3.1%, 0.7% forecast, -2.1% previous
•Canada Foreign Securities Purchases (Jul) 20.65B, 28.64B forecast, 41.25B previous
•Canada New Housing Price Index (MoM) (Aug) -0.1%, -0.1% previous
•Canada RMPI (YoY) (Aug) 22.8%, 18.2% previous
•Canada IPPI (YoY) (Aug) 13.5%, 12.3% previous
•Canada Foreign Securities Purchases by Canadians (Jul) -30.630B, 35.430B previous
•Canada IPPI (MoM) (Aug) 1.3%, 0.0% forecast, 0.3% previous
•US Atlanta Fed GDPNow (Q3) 5.1%, 5.1% forecast, 5.1% previous
Looking Ahead Economic Data (GMT)
•03:00 Japan BoJ Interest Rate Decision 1.25% forecast,1.00% previous
Looking Ahead Events And Other Releases (GMT)
•02:30 Japan BoJ Monetary Policy Statement
Currency Forecast
EUR/USD : The euro edged higher on Thursday as the U.S. dollar eased, a day after posting its biggest gain in three months against the common currency following the Federal Reserve’s rate hike and signal of further monetary tightening.The Fed delivered a unanimous 25-basis-point rate increase on Wednesday, accompanied by its closely watched dot plot, which indicated one additional rate hike this year.Meanwhile, revised official data showed eurozone inflation rose less than initially estimated in August. Annual inflation in the 21-nation euro area eased to 3.2% from the preliminary 3.3% reading, compared with 2.9% in July, according to the European Union’s statistics agency.Inflation across the single-currency bloc remains above the European Central Bank’s 2% target.Immediate resistance can be seen at 1.1566(50%fib), an upside break can trigger rise towards 1.1609(SMA20).On the downside, immediate support is seen at 1.1463(38.2%fib), a break below could take the pair towards 1.1339(23.6%fib).
GBP/USD: The British pound dipped against the dollar on Thursday after the Bank of England kept interest rates unchanged as expected.The BoE left interest rates at 3.75% but warned that borrowing costs could rise if the Iran war persists, while forecasting UK inflation to exceed 4% early next year.The Monetary Policy Committee voted 6-3 to maintain rates at 3.75%, matching its July decision and economists’ median forecast in a Reuters poll.BoE Governor Andrew Bailey said the impact of the recent surge in energy prices on broader inflation remained unclear.The central bank also unveiled a new long-term plan to reduce its holdings of British government bonds accumulated during previous efforts to support the economy. Active gilt sales will be paused for six months while the details of the new strategy are finalised. Immediate resistance can be seen at 1.3407(Sep 16th high), an upside break can trigger rise towards 1.3480(50%fib).On the downside, immediate support is seen at 1.3341(38.2%fib), a break below could take the pair towards 1.3275(July 28th low).
USD/CAD: The Canadian dollar traded flat on Thursday as investors digested the Federal Reserve’s interest-rate decision and awaited fresh catalysts.The Fed raised its key interest rate on Wednesday for the first time in more than three years and signalled further increases this year as it seeks to combat persistently high inflation.Markets are pricing in about a 53% chance of another rate hike at the Fed’s October meeting, according to CME Group’s FedWatch tool.Oil prices eased as additional Saudi supplies helped ease concerns over disruptions, although prices remained above $100 a barrel amid fears that the Middle East conflict could widen.Domestic data showed foreign investors bought a net C$20.65 billion ($14.76 billion) of Canadian securities in July, led by federal government bonds, following an upwardly revised C$41.25 billion purchase in June. Meanwhile, Canadian investors sold a net C$30.63 billion of foreign securities.. Immediate resistance can be seen at 1.3843(SMA 20), an upside break can trigger rise towards 1.3875(38.2%fib).On the downside, immediate support is seen at 1.3755(23.6%fib), a break below could take the pair towards 1.3709(Lower BB).
USD /JPY : The U.S. dollar dipped on Thursday as the yen strengthened ahead of the Bank of Japan’s widely expected decision to raise interest rates to a 31-year high.The BoJ is expected to raise its policy rate on Friday and signal further tightening to counter inflation risks, which could intensify if the start of a U.S. rate-hike cycle puts additional pressure on the yen.The expected move would be the first rate increase in three months, lifting borrowing costs closer to levels the BoJ considers neutral for the economy and marking another step away from decades of ultra-loose monetary policy that established the yen as a cheap global funding currency.A hike to 1.25% would take the BoJ’s policy rate to its highest level since 1995. It would also bring rates within its estimated 1.1%-2.5% range for Japan’s nominal neutral rate, the level at which monetary policy neither stimulates nor restrains economic growth . Immediate resistance can be seen at 156.88(SMA 20), an upside break can trigger rise towards 157.28(50%fib).On the downside, immediate support is seen at 155.65(38.2%fib) a break below could take the pair towards 155.00 (Psychological level).
Equities Recap
European shares fell to two-month lows on Thursday as expectations of further interest-rate hikes increased after the European Central Bank raised borrowing costs and warned that war-driven energy shocks could push inflation higher.
UK's benchmark FTSE 100 closed up by1.19 percent, Germany's Dax ended up 0.70 percent, France’s CAC finished the day up by 0.57 percent.
Wall Street rebounded on Thursday as easing oil prices, falling U.S. Treasury yields and resilient labor data helped investors look past the Federal Reserve’s first interest-rate hike in more than three years.
Dow Jones closed up by 0.61% percent, S&P 500 closed up by 1.14% percent, Nasdaq settled up by 1.69% percent.
Commodities Recap
Gold gained more than 2% on Thursday, rebounding from a nearly six-week low hit in the previous session, as easing oil prices and a weaker U.S. dollar supported the precious metal while investors assessed the Federal Reserve’s latest rate hike.
Spot gold was up 2.3% at $4,360.36 per ounce as of 1:45 p.m. EDT (1745 GMT). US gold futures for December delivery settled 0.3% higher at $4,399.70.
Oil prices settled about 1% lower on Thursday but remained above $100 a barrel as investors weighed supply disruptions from strikes involving Saudi Arabia and Yemen’s Iran-backed Houthis against reports that additional Saudi crude could reach global markets and ease concerns over supply.
Brent crude futures closed down $1.01, or 0.95%, at $104.82 a barrel, while US West Texas Intermediate futures fell 52 cents, or 0.5%, to $101.91 a barrel. Both benchmarks had fallen about 3% on Wednesday.
