Market Roundup
• China House Prices (YoY) (Feb): -3.2%, -3.1% previous.
• China Industrial Production YTD (YoY) (Feb): 6.3%, 5.9% previous.
• China Industrial Production (YoY) (Feb): 6.3%, 5.3% forecast, 5.2% previous.
• China Unemployment Rate (Feb): 5.3%, 5.1% forecast, 5.1% previous.
• China Fixed Asset Investment (YoY) (Feb): 1.8%, -5.0% forecast, -3.8% previous.
• China Retail Sales YTD (YoY) (Feb): 2.80%, 2.73% previous.
• China Retail Sales (YoY) (Feb): 2.8%, 2.6% forecast, 0.9% previous.
Looking Ahead Economic Data (GMT)
• 10:30 German 12-Month Bubill Auction 1.985% previous.
• 10:30 German 6-Month Bubill Auction 1.986% previous.
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro edged higher on Monday as investors braced for a slew of central bank meetings under the shadow of the U.S.-Israel war on Iran.At least eight central banks, including the U.S. Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan meet this week to set rates, in their first policy meetings since the Middle East conflict began.Focus will be on policymakers' assessment of the impact of higher oil prices on inflation and growth.U.S. President Donald Trump called on allies over the weekend to help secure the Strait of Hormuz and said his administration is talking to seven countries about it.The dollar index eased slightly to 100.29, though that comes after a more than 1.5% gain last week, and it remained perched near a 10-month high. Immediate resistance can be seen at 1.1454(Daily high), an upside break can trigger rise towards 1.1526 (50%fib).On the downside, immediate support is seen at 1.1421(23.6%fib), a break below could take the pair towards 1.1373(Lower BB).
GBP/USD: The pound edged lower on Monday as heightening uncertainty over hostilities in the Middle East kept investors cautious.European Union foreign ministers will discuss on Monday bolstering a small naval mission in the Middle East, though any operation in the Strait would be fraught with risk.Central banks in the U.S., UK, Europe, Japan, Australia, Canada, Switzerland and Sweden hold their first full meetings since the start of the war, with energy prices looming over all of them.The Federal Reserve is considered certain to hold on Wednesday and the chance of an easing by June has come down to just 26%, from 69% a month ago. Sterling was up 0.23% at $1.3253, though was not far from the 3-1/2-month low it hit on Friday as it clocked a 1.5% weekly decline. Immediate resistance can be seen at 1.3361(March 13th high), an upside break can trigger rise towards 1.3417(50%fib).On the downside, immediate support is seen at 1.3229(61.8%fib), a break below could take the pair towards 1.3170(Lower BB).
AUD/USD: The Australian dollar firmed on Monday as U.S. dollar eased allowing the Australian dollar to recover modestly. Market focus now turns to Tuesday’s RBA policy meeting, where investors broadly expect a 25 basis-point rate hike.The tone of the statement and forward guidance will be critical in determining whether policymakers signal further tightening or adopt a more cautious stance.Geopolitical tensions remain elevated after the United States struck Iran’s key oil export hub at Kharg Island, a development that has raised fears of wider disruption in global energy supplies while prospects for a ceasefire remain uncertain. Oil markets remain the central focus, as the sharp rise in crude prices is fuelling concerns about renewed global inflation pressures, which in turn is pushing bond yields higher and keeping fixed-income markets under strain. Immediate resistance can be seen at 0.7075(38.2%fib), an upside break can trigger rise towards 0.7169(23.6%fib).On the downside, immediate support is seen at 0.6981(50%fib), a break below could take the pair towards 0.6941(Lower BB).
USD/JPY: The US dollar edged lower on Monday as the yen gained support after comments from Japan’s Finance Minister Satsuki Katayama on the recent sharp depreciation of the Japanese currency.Satsuki Katayama said on Monday the government is ready to take decisive action against excessive FX volatility .The warning from Satsuki Katayama comes as the yen nears ¥160 per dollar, putting traders on alert for possible intervention by Japanese authorities. Meanwhile, The Bank of Japan is expected to hold rates Thursday but maintain a rate-hike bias as a weak yen and rising oil prices lift inflation risks. Investors will watch Governor Kazuo Ueda’s post-meeting briefing for clues on the timing of the next rate hike and how the Bank of Japan balances supporting the economy and managing inflation risks. Immediate resistance can be seen at 159.84(23.6%fib) an upside break can trigger rise towards 160.00(Psychological level) .On the downside, immediate support is seen at 157.66(38.2%fib) a break below could take the pair towards 156.87 (SMA 20).
Equities Recap
Asian markets were cautious Monday as Gulf tensions kept oil prices high, clouding the inflation outlook and likely keeping most central banks on hold this week, with one possibly hiking rates.
Japan’s Nikkei 225 was down by 0.10% , Hang Seng was up at 1.45 %, China A50 was up at 0.76 %
Commodities Recap
Oil prices rose Monday as investor focus returned to threats to Middle East oil facilities, despite calls from Donald Trump for nations to help protect the Strait of Hormuz, a key global energy route.
Brent crude rose $2.73 (2.7%) to $105.87 a barrel by 0730 GMT after a $2.68 gain Friday, while WTI crude climbed $1.65 (1.7%) to $100.36 after rising nearly $3 in the previous session.
Gold held steady Monday after trimming an earlier ~1% drop, as a softer dollar and safe-haven demand offset reduced expectations for near-term U.S. rate cuts amid high energy prices.
Spot gold edged up 0.2% to $5,027.98 per ounce, as of 0427 GMT, recovering from a more than three-week low hit earlier in the session. U.S. gold futures for April delivery fell 0.6% to $5,031.60.
