Europe Roundup: Euro holds near 5-month high, European stocks rise, Gold hits another record Oil up-March 18th,2025

Market Roundup

• Italian Trade Balance (Jan) -0.264B, 5.150B forecast, 5.820B previous

•Italian Trade Balance EU (Jan) -0.64B ,-2.02B previous

•UK 4-Year Treasury Gilt Auction 4.263% ,4.294% previous

•German ZEW Current Conditions (Mar) -87.6 -80.5 forecast,  -88.5 previous

•German ZEW Economic Sentiment (Mar) 51.6 48.1 forecast,  26.0 previous

•EU Trade Balance (Jan) 1.0B 14.0B forecast,   15.4B previous

•EU ZEW Economic Sentiment (Mar) 39.8 ,43.6 forecast,   24.2 previous

Looking Ahead Economic Data(GMT)

•12:30 US  Building Permits (MoM) (Feb) -0.6% previous

•12:30 US  Building Permits (Feb) 1.450M forecast,    1.473M previous

•12:30 US  Export Price Index (MoM) (Feb) -0.2% 1.3% previous

•12:30 US  Export Price Index (YoY) (Feb) 2.7% previous

•12:30 US  Housing Starts (MoM) (Feb) -9.8% previous

•12:30 US  Housing Starts (Feb) 1.380M forecast,   1.366M previous

•12:30 US  Import Price Index (YoY) (Feb) 1.9% previous

•12:30 US  Import Price Index (MoM) (Feb) -0.1% forecast,   0.3% previous

•12:30 Canada Common CPI (YoY) (Feb) 2.2% forecast,  2.2% previous

•12:30 Canada Core CPI (MoM) (Feb) 0.4% previous

•12:30 Canada Core CPI (YoY) (Feb) 2.1% previous

•12:30 Canada CPI (MoM) (Feb) 0.6% forecast,  0.1% previous

•12:30 Canada CPI (YoY) (Feb) 2.1% forecast,  1.9% previous

•12:30 Canada Median CPI (YoY) (Feb) 2.7% forecast,  2.7% previous

•12:30 Canada Trimmed CPI (YoY) (Feb) 2.8% forecast, 2.7% previous

Looking Ahead Economic Data(GMT)

•13:15 US  Capacity Utilization Rate (Feb) 77.8% forecast, 77.8% previous

•13:15 US  Industrial Production (MoM) (Feb) 0.2% forecast,  0.5% previous

•13:15 US  Industrial Production (YoY) (Feb) 2.00% previous

•13:15 US  Manufacturing Production (MoM) (Feb) 0.3% forecast,  -0.1% previous

•14:00  New Zealand  GlobalDairyTrade Price Index -0.5% previous

•14:00 US Milk Auctions 4,209.0 previous             

•15:30 US  52-Week Bill Auction 4.050% previous                             

•17:00 US 20-Year Bond Auction 4.830% previous                            

•17:15  US Atlanta Fed GDPNow (Q1)  -2.1% forecast, -2.1% previous                     

Looking Ahead Events And Other Releases(GMT)

• No Events Ahead

Currency Forecast

EUR/USD: The euro traded near a five-month high on Tuesday ahead of an expected vote on Germany's massive stimulus proposal. Germany's constitutional court on Monday threw out new challenges by opposition parties against a plan by the prospective coalition government to push a massive public borrowing initiative through the outgoing parliament.The decision paved the way for parliament to convene on Tuesday to consider the matter. Investors were also focused on the outcome of Ukraine-Russian cease-fire talks, which could translate to lower energy costs for Europe. Immediate resistance can be seen at 1.0946 (23.6%fib), an upside break can trigger rise towards 1.1000(Psychological level).On the downside, immediate support is seen at 1.0804(38.2%fib), a break below could take the pair towards 1.0693(50%fib).

GBP/USD: The British pound   held steady on Tuesday as expectations grew that the Bank of England would keep interest rates unchanged later this week.The Bank of England is expected to hold interest rates steady on Thursday, maintaining a gradual approach amid the impact of Trump’s trade war, mixed UK economic data, and long-term inflation concerns.Investors will closely watch for any shifts in the views of MPC members, as some have expressed greater concern about the risk of persistent inflation than others.Money markets have priced in 54 basis points of Bank of England rate cuts in 2025 and see an 89% probability of no rate change this week.At GMT 11:22, the pair was trading down 0.04% at 1.2985. Immediate resistance can be seen at 1.3012(23.6%fib), an upside break can trigger rise towards 1.3072(Higher BB).On the downside, immediate support is seen at 1.2902(March 17th low), a break below could take the pair towards 1.2873(38.2%fib)

AUD/USD: The Australian dollar   eased slightly  on Tuesday as investors assessed the economic risks of rising global trade tensions. This week, central banks in the U.S., Britain, and Japan meet with no policy changes expected, but rising trade tensions add uncertainty. Australia’s central bank stated on Tuesday that it remains more cautious than markets on further policy easing, following its first rate cut in over four years last month. The Reserve Bank of Australia (RBA) lowered interest rates by 25 basis points to 4.1% in its February meeting, citing the need to stay in line with other central banks that had already begun easing.At GMT 12:22, The Australian dollar was last  trading down 0.22% to $0.6369. Immediate resistance can be seen at 0.6389(Daily high), an upside break can trigger rise towards 0.6382(23.6%fib).On the downside, immediate support is seen at 0.6351(38.2%fib), a break below could take the pair towards 0.6304(50%fib).

 USD/JPY: The dollar strengthened on Tuesday as Japanese yen weakened amid risk-on sentiment spurred by Wall Street's gains overnight. The market rout and fears of a global slowdown caused by U.S. President Donald Trump's tariff policy are overshadowing wage and price data showing Japan is making progress towards durably achieving the BOJ's 2% inflation target. The Bank of Japan is expected to keep interest rates unchanged on Wednesday while assessing the risks that the escalating U.S. trade war poses to Japan’s export-driven economy. The BOJ is set to maintain its short-term policy rate at 0.5% at a two-day meeting that ends on Wednesday. At GMT 12.22,the dollar was up  0.46% at 149.73 against Japanese yen. Immediate resistance can be seen at 149.84(Daily high) an upside break can trigger rise towards 150.84(50%fib). On the downside, immediate support is seen at 149.22(38.2%fib) a break below could take the pair towards 148.25(March 17th low).

Equities Recap          

European markets remained steady on Tuesday as German lawmakers prepared to vote on a major government spending overhaul, while uncertainty surrounding a Trump-Putin call on Ukraine kept gold at $3,000 an ounce.

At GMT (12:19) UK's benchmark FTSE 100 was last trading up at 0.36  percent, Germany's Dax was up by 1.43 percent, France’s CAC finished was up by 0.65percent.

Commodities Recap

Gold reached a new record high above $3,000 an ounce on Tuesday as investors sought safe-haven assets amid renewed Middle East tensions and concerns over Trump’s tariff policies.

Spot gold hit a peak of $3,028.24 in early trade and by 1105 was at $3,023.09 an ounce, up 0.7%. Prices climbed above $3,000 for the first time on March 14. U.S. gold futures gained 0.8% to $3,031.30.

Oil prices rose more than 1% on Tuesday, reaching their highest levels this month, supported by Middle East tensions and China’s stimulus measures.

Brent futures climbed 91 cents, or 1.3%, to $71.98 a barrel by 1200 GMT, while U.S. West Texas Intermediate crude futures also rose 91 cents, 1.4%, to $68.49.