Market Roundup
•Australia Home Loans (MoM) (Q4) 10.6%, 6.2% previous
•Australia Invest Housing Finance (MoM) (Q4)7.9%, 9.2% previous
•China CPI (MoM) (Jan) 0.2%, 0.3% forecast, 0.2% previous
•China CPI (YoY) (Jan) 0.2%, 0.4% forecast, 0.8% previous
•China PPI (YoY) (Jan) -1.4%, -1.5% forecast, -1.9% previous
Looking Ahead Economic Data (GMT)
•09:00 Italian Industrial Production (YoY) (Dec) 1.4% previous
•09:00 Italian Industrial Production (MoM) (Dec) -0.6% forecast, 1.5% previous
•10:10 Italian 12-Month BOT Auction 2.112% previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Summaries
EUR/USD : The euro firmed on Wednesday as U.S. dollar weakened after U.S. retail sales data missed expectations .Overnight, the U.S. posted slower-than-expected retail sales in December, while a separate report showed growth in U.S. labour costs unexpectedly slowed in the fourth quarter.In the broader market, U.S. jobs data was the main focus for investors on Wednesday, where expectations are for nonfarm payrolls to have risen by 70,000 in January. The unemployment rate is seen holding steady at 4.4%.Markets are now pricing in roughly 60 basis points worth of easing from the Federal Reserve by December, even as some policymakers said rates could remain on hold for some time.. Immediate resistance can be seen at 1.1872(38.2%fib), an upside break can trigger rise towards 1.1974(Jan 30th high).On the downside, immediate support is seen at 1.1783(SMA 20), a break below could take the pair towards 1.1724(50%fib).
GBP/USD: Sterling firmed on Wednesday as dollar weakened after U.S. data suggested the economy may be softening. The Commerce Department said retail sales were unchanged in December, falling short of a forecast by economists polled by Reuters for a rise of 0.4% and below the unrevised 0.6% increase in November. Some investors say weaker data could allow the Federal Reserve more leeway to cut interest rates.As investors digested the economic news, they braced for the nonfarm U.S. payrolls report for January, which is due on Wednesday. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.1% to 96.85. Immediate resistance can be seen at 1.3663(38.2%fib), an upside break can trigger rise towards 1.3733(Feb 4th high).On the downside, immediate support is seen at 1.3583 (SMA 20), a break below could take the pair towards 1.3512(50%fib).
AUD/USD: The Australian dollar climbed to a fresh three-year peak on Wednesday as the central bank signalled hawkish policy again, while the greenback came under pressure from softer U.S. economic data.RBA Deputy Governor Andrew Hauser said inflation remains high and the economy is near capacity, fueling expectations of further policy tightening. The RBA raised its cash rate to 3.85% last week, with markets pricing in a roughly 70% chance of a 4.10% hike in May after Q1 inflation data. Adding to the case for a rate hike, data on Wednesday data showed Q4 mortgage lending jumped 9.5% and investment loans hit a record. Immediate resistance can be seen at 0.7126(23.6%fib), an upside break can trigger rise towards 0.7202(Higher BB).On the downside, immediate support is seen at 0.7068(Daily low), a break below could take the pair towards 0.6700(Psychological level)
USD/JPY: The U.S. dollar slipped lower on Wednesday as yen firmed as investors viewed Prime Minister Takaichi’s election victory as a boost for fiscal discipline.After a decisive election win, Takaichi gained a strong mandate for higher spending and tax cuts, reaffirming her plan to suspend the 8% food sales tax for two years.Investors so far believe her policies won’t significantly impact Japan’s fiscal health, lifting equities and the yen and steadying government bonds.The yen was also supported by concers that Japanese authorities might intervene to curb speculative FX selling in foreign exchange market. Immediate resistance can be seen at 153.65(50%fib) an upside break can trigger rise towards 154.00(Psychological level) .On the downside, immediate support is seen at 151.89 (Lower BB) a break below could take the pair towards 151.29 (Lower BB).
Equities Recap
Asian equities advanced on Wednesday, led by South Korea and Taiwan, while Thailand’s market extended its post-election rally on hopes of political stability and new economic measures.
Hang Sang was up 0.47%, Japan’s Nikkei 225 was up by 2.28% ,South Korea’s KOSPI was up at 1.13 %
Commodities Recap
Oil remained steady on Wednesday, supported by ongoing U.S.–Iran talks and persistent geopolitical uncertainty as the market awaited clearer direction.
Brent crude oil futures were up 23 cents, or 0.3%, at $69.03 a barrel by 0100 GMT. U.S. West Texas Intermediate crude rose 23 cents, or 0.4%, to $64.19.
Gold climbed on Wednesday as U.S. Treasury yields dropped, following data showing December retail sales growth stalled, pointing to a slowing economy ahead of crucial jobs figures.
Spot gold edged 0.3% higher to $5,038.73 per ounce by 0059 GMT.U.S. gold futures for April delivery gained 0.6% to $5,060.60 per ounce.
