Market Roundup
•Spanish Aug Core CPI (YoY) 2.7%, 2.8% previous
•Spanish Aug CPI (YoY) 2.2%,2.4% forecast, 2.8% previous
•Spanish Aug CPI (MoM) 0.0%, 0.1% forecast, -0.5% previous
•Spanish Aug HICP (MoM) 0.0% ,0.2% forecast, -0.7% previous
•EU Aug Business and Consumer Survey 96.6,95.8 previous
•EU Aug Business Climate -0.62 ,-0.61 previous
•EUR Aug Consumer Confidence -13.5 ,-13.4 forecast, -13.0 previous
•EU Aug Consumer Inflation Expectation 11.3 , 11.2 previous
•EU Aug Selling Price Expectations 6.1 ,6.8 previous
•EU Aug Services Sentiment 6.3 , 5.2 forecast, 4.8 previous
•EU Aug Industrial Sentiment -9.7,-10.6 forecast, -10.5 previous
•German CPI (YoY) (Aug) 2.1% forecast, 2.3% previous
•German CPI (MoM) (Aug) 0.0% forecast, 0.3% previous
Looking Ahead Economic Data (GMT)
•12:30 US Continuing Jobless Claims 1,870K forecast, 1,863K previous
•12:30 US Core PCE Prices (Q2) 2.90% forecast, 3.70% previous
•12:30 US Corporate Profits (QoQ) (Q2) -2.7% previous
•12:30 US GDP (QoQ) (Q2) 2.8% forecast, 1.4% previous
•12:30 US GDP Price Index (QoQ) (Q2) 2.3% forecast, 3.1% previous
•12:30 US GDP Sales (Q2) 2.0% forecast, 1.8% previous
•12:30 US Goods Trade Balance -97.70B forecast, -96.56B previous
•12:30 US Initial Jobless Claims 232K forecast, 232K previous
•12:30 US Jobless Claims 4-Week Avg. 236.00K previous
•12:30 Canada Current Account (Q2) -6.0B forecast, -5.4B previous
•14:00’ US Jul Pending Home Sales (MoM) 0.2% forecast, 4.8% previous
•14:00’ US Jul Pending Home Sales Index 74.3 previous
Looking Ahead Events And Other Releases (GMT)
•16:00 SNB Chairman Thomas Jordan speaks
• 17:00 German Buba President Nagel Speaks
• 19:30 FOMC Member Bostic Speaks
Equities Recap
EUR/USD: The euro declined against the dollar after inflation data from Germany and Spain prompted investors to increase their expectations for an easing cycle by the European Central Bank. Inflation fell in six key German states in August, indicating that national inflation could see a significant drop this month, while in Spain, it slowed to its lowest rate in a year. As a result, money markets adjusted to price in 67 basis points of ECB rate cuts for 2024, up from around 63 basis points before the data. The euro fell 0.2% to $1.1098 after hitting a low of $1.1072, down from $1.1128 before the release of the German figures. It had reached a 13-month high of $1.1201 on Friday. Immediate resistance can be seen at 1.1184(23.6%fib), an upside break can trigger rise towards 1.1200(Psychological level).On the downside, immediate support is seen at 1.1110(38.2%fib), a break below could take the pair towards 1.1047 (50%fib).
GBP/USD: Sterling eased slightly against dollar on Thursday as investors digested inflation data from Germany and Spain . A cautious monetary policy easing stance from the Bank of England (BoE) has supported the pound since the central bank's cut to its Bank Rate at its August meeting. The BoE will cut rates just once more this year, in November, a majority of economists said in poll, as British inflation is expected to stay above target. Sterling eased slightly versus the dollar at $1.3181, having climbed to its highest since March 22 at $1.3269 on Tuesday. It was also on track for a 3.2% rise in August, its biggest monthly gain since November 2023. Immediate resistance can be seen at 1.3284(23.6%fib), an upside break can trigger rise towards 1.3315(Higher BB).On the downside, immediate support is seen at 1.3115(38.2%fib), a break below could take the pair towards 1.3052(50%fib).
AUD/USD: The Australian dollar held steady near eight-month highs against the U.S. dollar on Thursday, bolstered by a slight weakening of the greenback and momentum buyers targeting further resistance levels. Additionally, July inflation data exceeded market expectations, reinforcing the Reserve Bank of Australia's (RBA) stance that a rate cut is unlikely this year. Consequently, the market has reduced the probability of a November rate cut to 42%, down from 56% prior to the data release. As of 12:03 GMT, the Australian dollar was trading at $0.6814 against the U.S. dollar.
.Immediate resistance can be seen at 0.6812(23.6%fib), an upside break can trigger rise towards 0.6829(Higher BB).On the downside, immediate support is seen at 0.6733 (July 10th low), a break below could take the pair towards 0.6705(38.2%fib).
NZD/USD: The New Zealand dollar rose against the U.S. dollar on Thursday following data showing a significant surge in New Zealand's business confidence in August. According to an ANZ Bank survey released on Thursday, business confidence in New Zealand reached its highest level in a decade, with a net 50.6% of respondents expecting economic improvement over the next year, up from 27.1% in July. This optimism was driven by a strong rise in forward-looking activity indicators. As of 12:03 GMT, the New Zealand dollar was trading at $0.6271, up 0.41% against the U.S. dollar.Immediate resistance can be seen at 0.6300(23.6%fib), an upside break can trigger rise towards 0.6312 (Higher BB).On the downside, immediate support is seen at 0.6233 (38.2%fib), a break below could take the pair towards 0.6180(50%fib).
USD/JPY: The dollar edged higher against the yen on Thursday but gains were limited as traders looked ahead to a crucial U.S. inflation reading at the end of the week. Friday’s release of the core Personal Consumption Expenditures (PCE) price index the Federal Reserve's preferred inflation measure will be the week's main event . Investor expectations for imminent U.S. rate cuts were reinforced by Fed Chair Jerome Powell's remarks at Jackson Hole last week, where he indicated that the "time has come" to reduce rates, aligning with recent signals from other Fed policymakers. Federal Reserve Bank of Atlanta President Raphael Bostic stated on Wednesday that it may be "time to move on rate cuts," but emphasized the need for certainty before making such a decision. Strong resistance can be seen at 145.00(Psychological level), an upside break can trigger rise towards 146.56(38.2 %fib). On the downside, immediate support is seen at 143.75(23.6 %fib), a break below could take the pair towards 142.28(Lower BB).
Equities Recap
European shares remained resilient on Thursday, brushing off Wall Street's disappointment with Nvidia's results, the leader of the 'Magnificent 7' tech giants. Meanwhile, the euro and bond yields declined as softer-than-expected inflation data from Germany and Spain were released.
At GMT (12:11) UK's benchmark FTSE 100 was last trading up at 0.47 percent, Germany's Dax was up by 0.68 percent, France’s CAC finished was up by 0.71 percent.
Commodities Recap
Gold prices rose on Thursday amid expectations that the Federal Reserve might initiate interest rate cuts next month, supported by ongoing tensions in the Middle East.
Spot gold added 0.6% to $2,516.63 per ounce by 0850 GMT, not too far from a record high of $2,531.60 hit on Aug. 20.U.S. gold futures rose 0.5% to $2,550.00.
Oil prices stabilized on Thursday after two consecutive losing sessions, as renewed supply concerns in Libya countered the impact of a smaller-than-expected draw in U.S. crude inventories, which dampened demand expectations.
By 10:24 GMT, Brent crude futures had inched up 3 cents, or 0.04%, to $78.68 a barrel, while U.S. West Texas Intermediate crude futures rose 15 cents, or 0.2%, to $74.67.
