Market Roundup
• Japan PPI (YoY) (Jun)7.1%, 6.8% forecast, 6.6% previous
• Japan PPI (MoM) (Jun) 0.4%, 0.3% forecast, 1.1% previous
Looking Ahead Economic Data (GMT)
• 08:00 French CPI (MoM) (Jun) -0.2% forecast, 0.1% previous
• 08:00 French HICP (MoM) (Jun) -0.3% forecast, 0.1% previous
• 08:00 French HICP (YoY) (Jun) 2.0% forecast, 2.8% previous
• 08:00 Inflation (YoY) (Jun) 2.4% previous
• 08:00 French CPI (YoY) (Jun) 1.8% forecast, 2.4% previous
• 08:00 French CPI NSA (MoM) (Jun) -0.2% previous
• 08:00 French CPI NSA (YoY) (Jun) 1.8% previous
• 09:00 Italian Industrial Production (YoY) (May) 1.3% forecast, 1.3% previous
• 09:00 Italian Industrial Production (MoM) (May) -0.1% forecast, 0.5% previous
Looking Ahead Events And Other Releases (GMT)
• No Events Ahead
Currency Forecast
EUR/USD : The euro rose marginally on Friday as the U.S. dollar weakened, with markets balancing geopolitical-driven safe-haven demand against fading expectations for additional Fed rate hikes. U.S. and Iran continued to trade strikes, with Iranian armed forces launching attacks on U.S. military infrastructure in Gulf states on Thursday following U.S. strikes on Iran's southern coastal and eastern provinces.The latest round of strikes has fuelled inflation concerns and reinforced the probability of the Fed raising rates this year.Markets are pricing in a 63% chance of a September rate hike, up from around 54% a week earlier, according to CME's FedWatch tool. Immediate resistance can be seen at 1.1475(SMA 20), an upside break can trigger rise towards 1.1495(50%fib).On the downside, immediate support is seen at 1.1368(38.2%fib), a break below could take the pair towards 1.1291(Lower BB).
GBP/USD: The pound firmed on Friday as sterling drew support weaker dollar and improving political sentiment in the UK. Andy Burnham has moved closer to becoming the next Labour leader and UK prime minister after securing the backing of an overwhelming majority of Labour MPs to succeed Sir Keir Starmer.Burnham's leadership bid has been endorsed by 322 Labour MPs, making him the only declared candidate since nominations opened on Thursday.He is now just one nomination short of the 323 required to make it mathematically impossible for any rival candidate to enter the leadership contest.Immediate resistance can be seen at 1.3433(Daily high), an upside break can trigger rise towards 1.3485(50%fib).On the downside, immediate support is seen at 1.3343(38.2%fib), a break below could take the pair towards1.3296(SMA 20).
AUD/USD: Australian dollar edged higher on Friday as softer dollar combined with an improvement in global risk sentiment helped underpin demand for the risk-sensitive Australian currency.Stronger copper, gold and other commodity prices boosted the outlook for Australia's commodity-linked currency, encouraging buying interest in AUD/USD. Dollar weakened against major peers as well as decline in U.S. Treasury yields from recent highs, coupled with resilience in risk-sensitive assets, reduced demand for the greenback.The Reserve Bank of Australia will meet in August and is expected to keep its cash rate unchanged at 4.35%, though markets still price in a roughly 60% chance of one final rate hike later this year, depending on the movement of oil prices.Traders also await key employment and inflation data due later this month, which could offer fresh clues on the policy outlook.Immediate resistance can be seen at 0.6952 (SMA 20), an upside break can trigger rise towards 0.7000(Psychological level).On the downside, immediate support is seen at 0.6875(23.6%fib), a break below could take the pair towards 0.6811(Lower BB).
USD/JPY: The U.S. dollar fell sharply on Friday as the yen strengthened after Finance Minister Satsuki Katayama said the government would encourage domestic pension funds to increase their holdings of Japanese financial assets.The remarks drew attention to the Government Pension Investment Fund (GPIF), the world's largest pension fund, which managed 293.6 trillion yen ($1.8 trillion) in assets at the end of March.The latest news also highlights how urgently Tokyo is searching for ways to anchor markets buffeted by sharp swings in bond yields and the currency.Before Friday's news, the yen had been languishing near 40-year lows, keeping traders on guard for potential intervention by Japanese authorities. Immediate resistance can be seen at 162.73(23.6%fib) an upside break can trigger rise towards 163.00(Psychological level) .On the downside, immediate support is seen at 160.81(38.2%fib) a break below could take the pair towards 159.58(50%fib).
Equities Recap
Asian stocks rose sharply on Friday, led by gains in chipmakers and artificial intelligence-related shares, as investors looked past concerns over stalled energy shipments through the Strait of Hormuz despite escalating tit-for-tat attacks between the United States and Iran.
Japan’s Nikkei 225 was up by 1.37% , KOSPI was up at 3.32 %, Hang Seng was up at 0.97%
Commodities Recap
Gold edged lower on Friday and was on track for a weekly decline as escalating U.S.-Iran tensions raised concerns that higher inflation could keep the Federal Reserve on a hawkish monetary policy path.
Spot gold fell 0.2% to $4,113.29 per ounce by 0426 GMT and was headed for a 1.5% weekly decline. U.S. gold futures for August delivery fell 0.4% to $4,122.70.
Oil prices rose on Friday and were on track for weekly gains as renewed fighting between the United States and Iran heightened fears of supply disruptions in the Middle East, with shipping through the Strait of Hormuz remaining constrained.
Brent futures were up 19 cents, or 0.25%, to $76.49 a barrel by 0319 GMT. U.S. West Texas Intermediate (WTI) crude gained 19 cents, or 0.26%, to $72.27.
