Market Roundup
•UK Apr Manufacturing Production (MoM) -1.4%,-0.2%forecast, 0.3% previous
•German May CPI (MoM) 0.1%, 0.1% forecast,0.5% previous
•German May HICP (MoM) 0.2%,0.2% forecast,0.6% previous
•German May CPI (YoY) 2.4%,2.4% forecast,2.2% previous
•UK Apr GDP (MoM) 0.0%,0.0% forecast,0.4% previous
•UK Apr GDP (YoY) 0.6%,0.6% forecast,0.7% previous
•UK Apr Monthly GDP 3M/3M Change 0.7%,0.7% forecast,0.6% previous
•UK Apr Trade Balance -19.61B ,-14.20B forecast,-13.97B previous
•UK Apr Trade Balance Non-EU -7.29B, -3.81B previous
•UK Apr Industrial Production (MoM) -0.9%,-0.1% forecast,0.2% previous
Looking Ahead economic Data(GMT)
•12:30 US May CPI (MoM) 0.1% forecast,0.3% previous
•12:30 US Core CPI (YoY) 3.5% forecast,3.6% previous
•12:30 US May CPI (YoY) 3.4% forecast,3.4% previous
•12:30 US May CPI Index, n.s.a. 314.37 forecast,313.55 previous
•12:30 US May Core CPI (MoM) 0.3% forecast, 0.3% previous
•18:00 US May Federal Budget Balance -279.6B forecast,210.0B forecast,
Looking Ahead Events And Other Releases(GMT)
•13:30 ‘ECB's De Guindos Speaks
•13:45 EUECB McCaul Speaks
•14:00 EU ECB Supervisory Board Member Tuominen Speaks
•18:00 US Fed Interest Rate Decision 5.50% forecast,5.50% previous
•18:00 US FOMC Statement
•19:15 Canada BoC Gov Macklem Speaks
•19:30 German Buba President Nagel Speaks
Currency Forecast
EUR/USD: The euro edged higher on Wednesday but gains were limited as Investors' anticipated U.S. consumer inflation print and the Federal Reserve's commentary on interest rate policy. Investors will assess the inflation situation when U.S. consumer price index numbers are released at 1230 GMT, just before the Fed concludes its two-day policy meeting.The euro was up almost 0.2% at $1.0761 after a recent slide took the single currency to an almost six-week low of $1.07195 on Tuesday.The currency has been under pressure after far-right parties gained ground in European Parliament elections, prompting French President Emmanuel Macron to call a snap election, to be held in two rounds on June 30 and July 7 . Swirling rumours that Macron could resign if his camp does not win the election were firmly put to bed on Wednesday. Immediate resistance can be seen at 1.0766(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 edged higher on Wednesday even as data showed economic growth stagnated at the start of the second quarter, as analysts looked beyond one-off factors and still expected the economic recovery to gather pace in the coming months.Britain's economic growth was flat month-over-month in April, the Office for National Statistics said, weighed down partly by the impact of heavy rain on activity throughout the month. Markets are pricing around a 70% chance that the BoE cuts interest rates by the September meeting, while around 35 basis points of rate cuts are priced in this year. The U.S. is set to be the main driver for currency markets in the near term, with inflation figures and the Federal Reserve policy announcement both due later on Wednesday.The pound was last up 0.1% against the dollar at $1.2754. 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 eased against the Swiss franc on Wednesday as investors turned cautious ahead of U.S. consumer price index data for May and the Federal Reserve's rate decision and interest rate projections due later in the day. Investors will have a chance to assess the inflation situation when U.S. Consumer Price Index numbers are released at 1230 GMT, just hours before the Fed concludes its two-day policy meeting.The Fed is widely seen holding rates at 5.25%-5.5%, putting the focus on policymakers' updated economic projections known as the "dot plot" and Chair Jerome Powell's news conference for clues regarding the timing and pace of cuts. 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 Wednesday as investors awaited crucial U.S. inflation data and the outcome of the Federal Reserve's policy meeting later in the day.The Bank of Japan also meets this week, where it is widely expected to keep interest rates steady and consider whether to offer clearer guidance on how it plans to reduce its huge balance sheet.The yen's decline to a 34-year low of 160.245 per dollar at the end of April triggered several rounds of official Japanese intervention totalling 9.79 trillion yen ($62.22 billion).The yen was pinned at 157.35 per dollar, just off the one-week low of 157.40 touched the previous day. 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 gained on Wednesday, supported by a drop in euro zone bond yields ahead of the release of crucial U.S. inflation data and the outcome of the Federal Reserve's policy meeting later in the day.
UK's benchmark FTSE 100 was last up by 0.78 percent, Germany's Dax was last up by 0.66 percent, France’s CAC was last up by 0.56 percent.
Commodities Recap
Oil prices ticked higher on Wednesday after three key forecasters predicted that global oil inventories would fall in the second half of 2024, boosting prices.
Brent crude futures were up 76 cents, or 0.9%, to $82.68 a barrel at 1005 GMT, while U.S. West Texas Intermediate (WTI) crude futures were up 86 cents, or 1.1%, to $78.76.
Gold prices traded in a narrow range on Wednesday as investors awaited the U.S. consumer inflation print due later in the day and the Federal Reserve’s commentary on its interest rate policy.
Spot gold was 0.1% lower at $2,314.56 per ounce, trading in a $7 range, as of 0929 GMT. U.S. gold futures rose 0.2% to $2,331.10.
