Market Roundup
• French CPI (MoM) (Dec): 0.1%, 0.2% forecast, -0.2% previous
• French HICP (MoM) (Dec): 0.1%, 0.2% forecast, -0.2% previous
• French CPI (YoY) (Dec): 0.8%, 0.9% forecast, 0.9% previous
• French HICP (YoY) (Dec): 0.7%, 0.8% forecast, 0.8% previous
• HCOB Spain Services PMI (Dec): 57.1, 54.8 forecast, 55.6 previous
• HCOB Italy Services PMI (Dec): 51.5, 54.2 forecast, 55.0 previous
• HCOB Italy Composite PMI (Dec): 50.3, 53.8 previous
• HCOB France Services PMI (Dec): 50.1, 50.2 forecast, 51.4 previous
• HCOB France Composite PMI (Dec): 50.0, 50.1 forecast, 50.4 previous
• HCOB Germany Services PMI (Dec): 52.7, 52.6 forecast, 53.1 previous
• HCOB Germany Composite PMI (Dec): 51.3, 51.5 forecast, 52.4 previous
• HCOB Eurozone Services PMI (Dec): 52.4, 52.6 forecast, 53.6 previous
• HCOB Eurozone Composite PMI (Dec): 51.5, 51.9 forecast, 52.8 previous
Looking Ahead Economic Data (GMT)
•14:45 US S&P Global Services PMI (Dec): 52.9 forecast, 54.1 previous
•14:45 US S&P Global Composite PMI (Dec): 53.0 forecast, 54.2 previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro eased on Tuesday as euro weighed down by softer inflation data but moves were fairly muted. Inflation slowed in several German states in December, official data showed on Tuesday, pointing to a lower national rate in Europe's largest economy.Inflation fell below the 2% mark in North Rhine-Westphalia, Germany's most populous state, as well as Lower Saxony and Saxony. Inflation in the bloc has hovered around the European Central Bank's 2% target, boosted by price hikes in the services sector, and is expected to stay there for the foreseeable future.Immediate resistance can be seen at 1.1793(23.6%fib), an upside break can trigger rise towards 1.1828(Higher BB).On the downside, immediate support is seen at 1.1731(38.2%fib), a break below could take the pair towards 1.1680(50%fib).
GBP/USD: Sterling eased slightly on Tuesday as the dollar remained upbeat ahead of key market data this week. The upbeat mood in markets was driven by expectations for U.S. interest rate cuts. Traders were focused on a U.S. monthly employment report, due on Friday, which will influence the market's monetary policy expectations. Dollar had weakned on Monday after U.S. data showed manufacturing activity had contractedmore than expected in December and fallento a 14-month low, and dovishcomments from Minneapolis Federal Reserve President Neel Kash Financial markets are pricing in two Federal Reserve rate cuts this year. Immediate resistance can be seen at 1.3577(38.2%fib), an upside break can trigger rise towards 1.3620(Higher BB).On the downside, immediate support is seen at 1.3459 (50%fib), a break below could take the pair towards 1.3426(SMA 20).
AUD/USD: The Australian dollar firmed on Tuesday as a revival in risk sentiment and higher copper prices supported Australian dollar. The commodity-heavy currency is widely viewed as a liquid proxy for global risk appetite, as its movements tend to mirror shifts in investor sentiment. Copper prices hit record highs in London (CMCU3) and Shanghai as supply concerns intensified after a strike at a Chilean mine, with U.S. Comex copper also reaching an all-time high on Monday. Domestically, attention turns to Australia’s November CPI due Wednesday, expected to rise 3.65% year-on-year, slightly lower than October’s 3.8%.The trimmed mean measure of core inflation is expected to remain at 3.3%, reinforcing concerns that fourth-quarter inflation will stay uncomfortably high. Immediate resistance can be seen at 0.6695(23.6%fib), an upside break can trigger rise towards 0.6726(Higher BB).On the downside, immediate support is seen at 0.6654(Daily low), a break below could take the pair towards 0.6609(38.2%fib)
USD/JPY: The U.S. dollar initially gained but gave some ground against yen on Tuesday as markets increasingly priced in further interest rate hikes by the Bank of Japan this year.The yen remains underpinned by talk of potential official action to slow its decline and prospects for additional policy tightening by the BoJ. BoJ Governor Kazuo Ueda reiterated on Monday that policy rates will be guided by how the economy and inflation evolve relative to the bank’s forecasts.The remarks reflected rising optimism that Japan is finally leaving behind years of deflation and transitioning to a more sustainable growth environment. Attention is now turning to Friday’s U.S. employment report, which is seen as a key driver for Federal Reserve rate expectations and could determine the next directional move. Immediate resistance can be seen at 157.80(23.6%fib) an upside break can trigger rise towards 158.00(Psychological level) .On the downside, immediate support is seen at 155.91 (SMA 20) a break below could take the pair towards 155.61 (38.2%fib).
Equities Recap
European shares climbed on Tuesday as investors looked ahead to key data later this week and largely shrugged off the U.S. capture of Venezuelan President Nicolas Maduro.
At (GMT 13:38),UK's benchmark FTSE 100 was last trading up at 0.38 percent, Germany's Dax was up by 0.40 percent, France’s CAC was last down by 0.14 percent.
Commodities Recap
Oil prices edged slightly higher on Tuesday as the market weighed expectations of ample global supply this year against uncertainty around Venezuelan crude output after the U.S. capture of President Nicolas Maduro.
Brent crude futures were up 34 cents, or 0.55%, at $62.10 a barrel by 1230 GMT while U.S. West Texas Intermediate crude rose 30 cents, or 0.51%, to $58.62.
Gold prices edged higher on Tuesday, hovering at a one-week peak and closing in on record levels, with safe-haven demand being fed by geopolitical tensions over the U.S. capture of Venezuela's president and expectations of U.S. rate cuts.
Spot gold was up 0.3% at $4,461.09 per ounce, as of 1135 GMT, after rising nearly 3% in the last session. U.S. gold futures for February delivery rose 0.3% to $4,462.60.
