Market Roundup
• New Zealand Business NZ PMI (Aug) 45.8 forecast, 44.4 previous
•Japan Jul Capacity Utilization (MoM) 2.5%, ,-3.1% previous
•Japan Jul Industrial Production (MoM) 3.1% ,2.8% forecast -4.2% previous
Looking Ahead Economic Data(GMT)
•06:45 French CPI (MoM) (Aug) 0.6%forecast, 0.2% previous
•06:45 French CPI (YoY) (Aug) 1.9% forecast, 2.3% previous
•06:45 French HICP (YoY) (Aug) 2.2% forecast, 2.7% previous
•06:45 French HICP (MoM) (Aug) 0.6% forecast, 0.2% previous
•09:00 Industrial Production (YoY) (Jul) -2.7% forecast, -3.9% previous
•09:00 Industrial Production (MoM) (Jul) -0.6% forecast, -0.1% previous
•11:00 M2 Money Stock (YoY) (Aug) 6.2% forecast, previous 6.3%
•11:00 New Loans (Aug) 810.0B forecast, 260.0B previous
•11:00 Outstanding Loan Growth (YoY) (Aug) 8.6% forecast, previous 8.7%
•11:00 Chinese Total Social Financing (Aug) 2,950.0B forecast, previous 770.0B
Looking Ahead Events And Other Releases(GMT)
• No Events Ahead
Currency Forecast
EUR/USD: The euro advanced against the dollar on Friday, driven higher after the European Central Bank's widely expected quarter-point rate cut on Thursday. The ECB reduced interest rates, citing lower inflation and economic growth as reasons for easing slightly. While the second quarter-point rate cut since June was anticipated, the future pace of rate changes remains unclear. The ECB did not signal another rate cut for October and highlighted that domestic inflation remains high. Investors are now turning their attention to the Federal Reserve, which will announce its interest rate policy decision at the end of its two-day meeting next Wednesday. The euro was slightly higher at $1.1083, after rising 0.57% on Thursday. Immediate resistance can be seen at 1.1087(38.2%fib), an upside break can trigger rise towards 1.1170(23.6%fib).On the downside, immediate support is seen at 1.1017(38.2%fib), a break below could take the pair towards 1.0993 (Lower BB).
GBP/USD: The British pound strengthened on Thursday as dollar dipped as investors remained on tenterhooks ahead of next week's central bank bonanza where the focus is on the Federal Reserve and the size of its expected interest rate cut. The Fed is all but certain to cut rates next week, uncertainty around whether it will go with a 25 basis point cut or 50 basis points has kept investors on the edge and weighed on the dollar. The dollar index , which measures the currency against the yen and five other major rivals, dropped to a one-week trough at 101.03. Sterling was 0.1% higher at $1.31415 .Immediate resistance can be seen at 1.3164(38.2%fib), an upside break can trigger rise towards 1.3262(23.6%fib).On the downside, immediate support is seen at 1.3086(38.2%fib), a break below could take the pair towards 1.3000(psychological level).
AUD/USD: The Australian dollar advanced on Friday as rally in equities and commodities boosted antipodean currency, while revived bets for an outsized U.S. rate cut next week weighed on the greenback. Additionally, the Aussie was bolstered by news that China’s President Xi Jinping urged authorities to meet economic targets after recent data raised concerns about the world's second-largest economy. The Aussie held at $0.6727, having surged 0.7% overnight, moving further away from a one-month low of $0.6620 reached earlier in the week.Immediate resistance can be seen at 0.6739(38.2%fib), an upside break can trigger rise towards 0.6791(Sep 3rd high).On the downside, immediate support is seen at 0.6688(50%fib), a break below could take the pair towards 0.6626(61.8%fib).
USD/JPY: The dollar slipped against the yen on Thursday, weighed down by mixed U.S. economic data. U.S. producer prices rose 0.2% in August, exceeding the 0.1% increase expected by economists, though the overall trend still indicated slowing inflation. Meanwhile, initial claims for state unemployment benefits were 230,000 for the week ending September 7, in line with estimates. The yen was also bolstered by hawkish comments from Bank of Japan officials. BOJ board member Naoki Tamura suggested on Thursday that the central bank should raise rates to at least 1% as early as the second half of the next fiscal year, although he indicated that any rate hikes would likely be gradual and staged.Strong resistance can be seen at 142.44 (Sep 9th high), an upside break can trigger rise towards 143.00 (Psychological level). On the downside, immediate support is seen at 140.60(23.6%fib), a break below could take the pair towards 140.21 (Lower BB).
Equities Recap
Japan's Nikkei share average fell on Friday as a stronger yen weighed on export-oriented stocks, though gains in chip-related stocks helped to limit the losses.
The Nikkei was down 0.89% at 36,507.1 , after opening 0.13% higher.
Commodities Recap
Crude oil prices continued to rise, building on overnight gains of around 2%, as producers evaluated the impact on output in the Gulf of Mexico following Hurricane Francine’s damage to offshore oil-producing regions.
U.S. West Texas Intermediate crude futures rose 0.5% to $69.32 per barrel, building on Thursday's 2.5% rally. Brent crude futures added 0.4% to $72.26, after a 1.9% jump in the previous session.
Gold prices surged to an all-time high on Friday due to a weaker dollar and expectations of a potential U.S. interest rate cut next week. Meanwhile, palladium has risen 15% this week.
Spot gold was up 0.2% at $2,565 per ounce, as of 0258 GMT, after hitting a record high of $2,567.93 earlier in the session. Bullion has gained 2.7% for the week so far.U.S. gold futures rose 0.5% to $2,593.40.
