Market Roundup
•UK Apr Average Earnings ex Bonus 6.0%,6.0% forecast,6.0% previous
•UK May Claimant Count Change 50.4K ,10.2K forecast,8.9K previous
•UK Apr Unemployment Rate 4.4%,4.3% forecast,4.3% previous
•UK Apr Average Earnings Index +Bonus5.9%,5.7% forecast,5.7% previous
•UK Apr Employment Change 3M/3M (MoM) -140K,-100K forecast,-177K previous
Looking Ahead Economic Data(GMT)
•12:30 Canada AprBuilding Permits (MoM) 4.9% forecast,-11.7% previous
•12:55 US Redbook (YoY) 5.8% previous
Looking Ahead Events And Other Releases(GMT)
•16:45 EU ECB's Elderson Speaks
Currency Forecast
EUR/USD: The euro declined further lower on Tuesday a day after the announcement of a snap election in France had driven them lower, while investor attention began to turn to the double whammy of U.S. inflation data and a Federal Reserve meeting on Wednesday. The far-right National Rally was forecast on Monday to win a snap election in France but fall short of an absolute majority in the first opinion poll published after President Emmanuel Macron's shock decision to dissolve parliament.The euro was down 0.37 percent at $1.0725 . Immediate resistance can be seen at 1.0781(Daily high), an upside break can trigger rise towards 1.0809(38.2% fib).On the downside, immediate support is seen at 1.0741 (50% fib), a break below could take the pair towards 1.0671(61.8% fib).
GBP/USD: The pound was roughly unchanged against the dollar on Tuesday as investors await U.S. inflation data and the outcome of the Federal Reserve's policy meeting. Britain's labour market showed more signs of cooling in April as the unemployment rate rose, an awkward development for Prime Minister Rishi Sunak ahead of the July 4 election, despite another month of robust wage growth. The jobless rate for the three months to April rose to 4.4% from 4.3% between January and March, the highest reading since the three months to September 2021, the Office for National Statistics said on Tuesday.. Immediate resistance can be seen at 1.2790(23.6%fib), an upside break can trigger rise towards 1.2823(Higher BB).On the downside, immediate support is seen at 1.2704(38.2%fib), a break below could take the pair towards 1.2629(50% fib).
USD/CHF: The dollar was little changed against the Swiss franc on Tuesday as traders braced for crucial U.S. inflation data and Federal Reserve interest rate forecasts. Economists polled expect headline U.S. consumer price inflation to ease to 0.1% from 0.3% last month, and core price pressures to remain steady on the month at 0.3%.The Fed is widely expected to maintain status quo at the conclusion of its two-day policy meeting Wednesday, but officials will update their economic and interest rate projections.Markets are currently pricing in only 37 basis points of cuts by December, which implies an around 50% chance of a second cut this year. Immediate resistance can be seen at 0.8979 (38.2% fib), an upside break can trigger rise towards 0.9036(23.6% fib).On the downside, immediate support is seen at 0.8845 (50% fib), a break below could take the pair towards 0.8900 (61.8% fib).
USD/JPY: The U.S. dollar eased against yen on Tuesday as investors awaited Bank of Japan meeting this week. The Bank of Japan will set its policy on Friday. While Investors expect a reduction in the central bank's monthly government bond purchases as early as this meeting, gaping yield differentials with the U.S. have kept the yen on the defensive.The BOJ and the Japanese government are aligned on trying to limit yen weakness from scuppering a sought-after cycle of mild inflation and steady wage increases. The dollar added 0.15% to stand at 157.275 yen after earlier touching its highest since June 3 at 157.39. Strong resistance can be seen at 157.56(23.6%fib), an upside break can trigger rise towards 157.93(Higher BB).On the downside, immediate support is seen at 156.23(38.2% fib), a break below could take the pair towards 154.94 (50%fib).
Equities Recap
European shares were rangebound on Tuesday following losses in the previous session on political uncertainties in France, while investor attention turned to the U.S. Federal Reserve's monetary policy meeting.
UK's benchmark FTSE 100 was last down by 0.96 percent, Germany's Dax was last down by 0.73 percent, France’s CAC was last down by 1.20 percent.
Commodities Recap
Oil prices were largely steady on Tuesday, as investors waited for U.S. and China inflation data and the outcome of the Federal Reserve's policy meeting to see how changing prices could hit demand.
Brent crude futures fell 14 cents, or 0.2%, to $81.49 per barrel by 1121 GMT, easing after a recovery from a close of $77.52 a week earlier. That close, the lowest since February, came as investors fretted about oversupply and low demand through the rest of 2024
