Market Roundup
• German Industrial Production (MoM) (Aug) -4.3%, -1.0% forecast,1.3% previous
• German German Industrial Production (YoY) (Aug) -4.20%,1.53% previous
• German German Car Registration (YoY) (Sep) 12.8%,5.0% previous
Looking Ahead Economic Data (GMT)
• 14:00 US CB Employment Trends Index (Sep) 106.41 previous
• 14:00 US Construction Spending (MoM) (Aug) -0.1% forecast,-0.1% previous
Looking Ahead Events and Other Releases(GMT)
• 12:50 ECB Supervisory Board Member Tuominen Speaks
• 13:30 US Fed Vice Chair for Supervision Barr Speaks
• 14:00 US Fed Goolsbee Speaks
Currency Forecast
EUR/USD : The euro slipped for third consecutive day against the U.S. dollar on Wednesday, weighed down by political turmoil in France. President Emmanuel Macron faces mounting pressure to resign or call a snap parliamentary election following a series of resignations five prime ministers in less than two years. On Tuesday, outgoing Prime Minister Sebastien Lecornu held last-ditch talks to form a new government, the first premier Macron appointed in 2017. Markets remain jittery, closely watching France's ability to reduce its large budget deficit. ECB President Christine Lagarde stressed the importance of France submitting its budget on time, highlighting that Eurozone fiscal discipline remains a priority amid market uncertainty. The euro hit a new 1-1/2-month low at $1.1607, and was last down 0.38% at $1.1613. Immediate resistance can be seen at 1.16662(Daily high), an upside break can trigger rise towards 1.1733(38.2%fib).On the downside, immediate support is seen at 1.1599(50%fib), a break below could take the pair towards 1.1565(Lower BB)
GBP/USD: The pound slipped on Wednesday as the U.S. dollar gained, with investors seeking safe-haven assets amid worries over a prolonged U.S. government shutdown. The shutdown, now in its eighth day, has delayed key economic data, leaving markets reliant on private-sector indicators to gauge the timing and extent of potential Fed rate cuts.Bank of England officials Huw Pill and Catherine Mann, who supported September’s decision to hold rates, are scheduled to speak this week Pill on Wednesday and Mann on Thursday. The BoE also warned that global markets could experience sharp declines if confidence falters in artificial intelligence prospects or the independence of the U.S. Federal Reserve. Immediate resistance can be seen at 1.3500(SMA 20), an upside break can trigger rise towards 1.3530(38.2%fib).On the downside, immediate support is seen at 1.3344(50%fib), a break below could take the pair towards 1.3309(Lower BB).
NZD/USD: The New Zealand dollar slipped to a six-month low on Wednesday after the Reserve Bank of New Zealand delivered a larger-than-expected interest rate cut. The central bank surprised markets with a 50 basis point reduction, citing concerns about the fragile economy.Since August 2024, the RBNZ has cut rates by 300 basis points, and with inflation now within its 1–3% target range, policymakers have room to reduce borrowing costs further.The dovish move provides some relief to the New Zealand government and Prime Minister Christopher Luxon, whose popularity has waned in recent months as the anticipated economic recovery has yet to materialize. Immediate resistance can be seen at 0.5800(38.2%fib), an upside break can trigger rise towards 0.5856(50%fib).On the downside, immediate support is seen at 0.05734 (23.6%fib), a break below could take the pair towards 0.5708(Lower BB).
USD/JPY: The U.S. dollar rose above the 152.00 level on Wednesday as investors awaited fiscal policy signals from Japan’s prime minister-designate, Sanae Takaichi, who stunned markets by winning the ruling party’s leadership election over the weekend. Takaichi’s victory has raised questions about whether the protégé of the late Shinzo Abe will pursue stimulus policies that could support stocks but keep the yen under pressure.Former Bank of Japan executive Kazuo Momma noted on Wednesday that the yen’s recent sharp declines could prompt the central bank to raise interest rates as soon as this month. The yen has fallen over 3% this week against the dollar, on track for its steepest weekly drop in a year. Immediate resistance can be seen at 152.72(38.2%fib) an upside break can trigger rise towards 153.00 (Psychological level) .On the downside, immediate support is seen at 151.80 (Daily low) a break below could take the pair towards 150.75 (50%fib).
Equities Recap
European shares hit record highs as steel stocks jump on EU quota cuts, while a bank rally offsets BMW-driven auto weakness.
UK's benchmark FTSE 100 was up by 0.90 percent, Germany's Dax was up by 0.72 percent, France’s CAC was up by 0.90 percent.
Commodities Recap
Gold raced past $4,000 an ounce for the first time on Wednesday as investors piled into a record-breaking rally in the safe-haven asset to hedge against global economic uncertainty, while also betting on U.S. interest rate cuts.
Spot gold was up 1.3% at $4,036.22 per ounce by 1154 GMT. U.S. gold futures for December delivery gained 1.3% to $4,058.
Oil prices rose over 1% on Wednesday, supported by a smaller-than-expected OPEC+ production increase next month, though concerns over oversupply limited further gains
Brent crude futures rose 82 cents, or 1.3%, to $66.27 a barrel by 0945 GMT. U.S. West Texas Intermediate crude climbed 85 cents, or 1.4%, to $62.58.
