Market Roundup
• Japan GDP (QoQ) (Q4): 0.1%, 0.4% forecast, -0.7% previous
• Japan GDP (YoY) (Q4): 0.2%, 1.6% forecast, -2.6% previous
• Japan GDP Price Index (YoY) (Q4): 3.4%, 3.2% forecast, 3.5% previous
• Japan GDP Capital Expenditure (QoQ) (Q4): 0.2%, 0.8% forecast, -0.3% previous
• Japan GDP External Demand (QoQ) (Q4): 0.0%, 0.1% forecast, -0.3% previous
• Japan GDP Private Consumption (QoQ) (Q4): 0.1%, 0.1% forecast, 0.4% previous
Looking Ahead Economic Data (GMT)
•08:00 Swiss GDP (QoQ) (Q4) -0.5% previous
•10:00 EU Industrial Production (MoM) (Dec) -1.5% forecast, 0.7% previous
•10:00 EU Industrial Production (YoY) (Dec)1.2% forecast, 2.5% previous
Looking Ahead Events And Other Releases (GMT)
•10:00 EU Eurogroup Meetings
Currency Forecast
EUR/USD : The euro eased slightly on Monday as U.S. dollar was steady as soft inflation data bolstered the case for interest rate cuts from the Federal Reserve later this year.Data on Friday showed U.S. consumer prices increased less than expected in January, giving the Fed additional leeway for policy easing.Federal Reserve Bank of Chicago President Austan Goolsbee said on Friday that interest rates could go down, but noted that services inflation remained high.Futures imply 62 basis points of easing over the rest of this year. The next cut is likely in June, with markets assigning 68% odds to a reduction.The euro traded down 0.01% at $1.1863. 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: The pound edged lower on Monday as the U.S. dollar held steady following softer inflation data, which strengthened expectations that the Federal Reserve could begin cutting interest rates later this year. U.S. markets were closed for the Presidents’ Day holiday, while Chinese markets remained shut for the Lunar New Year. Data released Friday showed the U.S. Consumer Price Index rose 0.2% in January, slowing from an unrevised 0.3% increase in December, according to the Bureau of Labor Statistics. Economists had expected a 0.3% rise. Markets expect the Federal Reserve to keep rates unchanged at its March 18 meeting, but are currently pricing in around 75 basis points of rate cuts this year, with the first move anticipated in July. 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 edged lower on Monday as investors shifted their attention to the upcoming release of the latest minutes from the Reserve Bank of Australia.The minutes, due Tuesday, are expected to offer further insight into the reasoning behind the recent 25 basis point rate hike. The governor previously signalled that a renewed rise in inflation left the central bank with little choice but to tighten policy, noting that the strength in consumer spending and business investment had surprised the board.The Reserve Bank of Australia raised interest rates to 3.85% earlier this month, and the forthcoming minutes may reveal how hawkish policymakers were in assessing the economic outlook.Meanwhile, Thursday’s employment report is forecast to show a 20,000 increase in jobs for January, following December’s strong 65,200 gain, with the unemployment rate expected to tick up to 4.2%. 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 edged higher on Monday as weak fourth-quarter GDP data from Japan weighed on the yen. Government figures showed the world’s fourth-largest economy grew at an annualised pace of just 0.2% in the October–December quarter, well below the median forecast of 1.6%, highlighting fragile economic momentum.The data underscored the challenges facing Prime Minister Sanae Takaichi and her government, with the economy barely expanding during the period. Meanwhile, the Bank of Japan is scheduled to meet in March, with markets assigning around a 20% probability of a rate hike. However, economists surveyed by Reuters expect the central bank to hold off on tightening until July. Immediate resistance can be seen at 153.67(Feb 14th high) an upside break can trigger rise towards 155.18(38.2%fib) .On the downside, immediate support is seen at 152.39 (38.2%fib) a break below could take the pair towards 151.40 (Lower BB).
Equities Recap
Asian shares consolidated recent strong gains on Monday in thin trading due to the Lunar New Year holiday.
Hang Sang was up 0.52%, Japan’s Nikkei 225 was down by 0.07% ,South Korea’s KOSPI was down at 0.28%
Commodities Recap
Gold prices fell on Monday amid thin trading as markets in the United States and China remained closed for public holidays, while profit-taking followed the previous session’s 2.5% surge.
Spot gold fell 1.1% to $4,986.32per ounce by 0550 GMT. U.S. gold futures for April delivery lost 0.8% to $5,005.60 per ounce.
Oil traded little changed on Monday as investors weighed the impact of upcoming U.S.–Iran talks aimed at easing tensions, alongside expectations of increased supply from OPEC+.
Brent crude futures edged up 3 cents to $67.78 a barrel by 0358 GMT.U.S. West Texas Intermediate crude was at $62.91 a barrel, up 2 cents. There will be no WTI settlement on Monday due to a U.S. holiday.
