Market Roundup
• Australia Westpac Consumer Sentiment (Jan)-1.7%,-9.0% previous
•Japan Current Account n.s.a. (Nov)3.674T,3.594Tforecast,2.834T previous
•Japan Adjusted Current Account (Nov)3.14T,3.04T forecast,2.48T previous
•Japan Bank Lending (YoY) (Dec)4.4%,4.1% forecast,4.1% previous
Looking Ahead Economic Data (GMT)
• 10:00 Greek CPI (YoY) (Dec)2.4% previous
•10:00 Greek HICP (YoY) (Dec) 2.8% previous
2.8% Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro edged lower on Tuesday as investors fretted about the Federal Reserve's independence after the Trump administration opened a criminal investigation into Chair Jerome Powell.Investors were still trying to come to grips with the Trump administration's investigation of Powell, a move that drew condemnation from former Fed chiefs and marked a dramatic escalation in the U.S. president's campaign to pressure the central bank into cutting rates faster.The market reaction has been to sell the dollar and U.S. Treasuries, while the unease also prompted some investors to seek safety in gold. The euro eased 0.08% to $1.1657, having risen as much as 0.5% in the previous session. Immediate resistance can be seen at 1.1688(50%fib), an upside break can trigger rise towards 1.1730(SMA20).On the downside, immediate support is seen at 1.1623(Lower BB), a break below could take the pair towards 1.1601(61.8%fib).
GBP/USDSterling edged higher on Tuesday as cloud of uncertainty over Federal Reserve independence favoured pound. The Trump administration's decision to open a criminal investigation into Fed Chair Jerome Powell drew condemnation from former Fed chiefs and a chorus of criticism from key members of Trump's Republican Party on Monday, following an unusually sharp public rebuke from Powell calling the move a "pretext" to win presidential influence over interest rates.The investigation, revealed late on Sunday when Powell said the Fed had received subpoenas from the U.S. Justice Department, was approved and started by Jeanine Pirro, the U.S. Attorney in Washington and an ally of President Donald Trump, according to two sources with knowledge of the investigation.The British pound nudged up 0.2% at $1.3468, rebounding from a one-month low. Immediate resistance can be seen at 1.3499(50%fib), an upside break can trigger rise towards 1.3566(Jan 12th high).On the downside, immediate support is seen at 1.3461(SMA 20), a break below could take the pair towards 1.3381(61.8%fib).
AUD/USD: The Australian dollar inched higher on Tuesday as greenback remained soft on concerns over the U.S. central bank's independence.Investors dumped the U.S. dollar and turned to gold after the Trump administration launched a criminal probe into Fed Chair Jerome Powell, raising concerns over the Federal Reserve’s independence.Fitch Ratings said on Monday it views the Fed's independence as a key supporting factor for its AA+ U.S. sovereign rating.In Australia, a Westpac survey showed consumer sentiment fell in January amid renewed rate jitters and an uncertain economic outlook.Markets price in about a 30% chance of a 25-bp RBA rate hike on February 3, rising to around 80% by May. Immediate resistance can be seen at 0.6712(Daily high), an upside break can trigger rise towards 0.6754(23.6%fib).On the downside, immediate support is seen at 0.6678(SMA20), a break below could take the pair towards 0.6654(38.2%fib)
USD/JPY: The U.S. dollar rose to one and half year high against yen on Tuesday as the yen stayed under pressure amid reports that PM Sanae Takaichi may call an early election.Uncertainty on the political front grew after Prime Minister Sanae Takaichi’s coalition ally floated the possibility of a snap election on February 8 or 15. Japan’s finance minister said she and the U.S. Treasury secretary share concerns over the yen’s one-sided weakness, as Tokyo signaled possible intervention to curb the decline. Katayama’s remarks highlight Japan’s growing concern over the yen’s slide, which broke past 158 per dollar for the first time in about a year after reports that PM Sanae Takaichi may call a February snap election.Broader markets remain focused on geopolitical risks, including possible U.S. action in Iran, Greenland-related developments, and a potential Supreme Court ruling on Trump-era tariffs due Wednesday. Immediate resistance can be seen at 158.00(Psychological level) an upside break can trigger rise towards 158.12(Higher BB) .On the downside, immediate support is seen at 156.42(SMA20) a break below could take the pair towards 156.01 (38.2%fib).
Equities Recap
Asian markets rose on Tuesday, led by a rally in Japanese stocks on strong AI optimism, while concerns over Fed independence boosted gold and weighed on the dollar.
Hang seng up 0.73%, Japan’s Nikkei 225 was up by 3.31% ,South Korea’s KOSPI was up at 1.47%
Commodities Recap
Gold prices edged lower on Tuesday as investors took profits after the metal hit a record near $4,600 an ounce in the previous session amid heightened geopolitical and economic uncertainty.
Spot gold traded 0.3% lower at$4,593.81 per ounce as of 0646 GMT, whileU.S. gold futures for February delivery slipped 0.6%to $4,587.10.
Oil prices rose further on Tuesday as Iran-related supply risks outweighed expectations of higher Venezuelan crude output.
Brent futures rose 47 cents, or 0.7%, to $64.34 a barrel by 0735 GMT, hovering near a two-month high. U.S. West Texas Intermediate crude climbed 45 cents, or 0.8%, to $59.95.
