Market Roundup
•UK Average Earnings ex Bonus (Aug) 4.7%, 4.7%forecast,4.8% previous
•UK Average Earnings Index +Bonus (Aug) 5.0% 4.7% forecast,4.8% previous
•UK Claimant Count Change (Sep) 25.8K,10.3K forecast, -2.0K previous
•UK Employment Change 3M/3M (MoM) (Aug) 91K,232K previous
•UK Unemployment Rate (Aug) 4.8%, 4.7%forecast,4.7% previous
•German CPI (YoY) (Sep) 2.4%, 2.4%forecast, 2.2% previous
•German CPI (MoM) (Sep) 0.2%, 0.2%forecast, 0.1% previous
• German ZEW Current Conditions (Oct) -80.0, -75.0 forecast, -76.4 previous
• German ZEW Economic Sentiment (Oct) 39.3, 41.2 forecast, 37.3 previous
• EU ZEW Economic Sentiment (Oct) 22.7, 30.2 forecast, 26.1 previous
Looking Ahead Economic Data(GMT)
•12:30 Canada Building Permits (MoM) (Aug) -0.7% forecast, -0.1% previous
•12:50 US Redbook (YoY) 5.8% previous
•15:30 US 3-Month Bill Auction 3.850% previous
•15:30 US 6-Month Bill Auction previous
Looking Ahead Events And Other Releases(GMT)
•12:45 US FOMC Member Bowman Speaks
•16:20 US Fed Chair Powell Speaks
•17:00 UK BoE Gov Bailey Speaks
•19:25 US Fed Waller Speaks
•19:30 US Fed Collins Speaks
Currency Forecast
EUR/USD : The euro edged slightly lower on Tuesday as political uncertainty in France and mixed economic signals from Germany weighed on sentiment. Sébastien Lecornu was reappointed as France’s prime minister on Friday, just four days after resigning, amid the country’s most severe political crisis in decades. Successive minority governments have struggled to pass deficit-cutting budgets through a deeply divided parliament split among three ideological blocs. Lecornu now faces a no-confidence vote, likely on Thursday.In Germany, investor confidence improved less than expected in October, as weak current economic conditions and delays in the long-anticipated recovery continued to dampen optimism. The ZEW Economic Sentiment Index rose to 39.3 from 37.3 in September, falling short of analysts’ expectations of 41.0. Immediate resistance can be seen at 1.16630(Oct 13th high), an upside break can trigger rise towards 1.1696(38.2%fib).On the downside, immediate support is seen at 1.1525(50%fib), a break below could take the pair towards 1.1506(Lower BB)
GBP/USD: The pound slipped lower on Tuesday after official data showed a cooling in wage growth which is being watched closely by Bank of England as it gauges when it should next cut interest rates. Britain's jobs market showed signs of stabilisation as pay growth increased at the slowest pace since 2022 and a measure of employment rose, according to official data published on Tuesday.Average weekly earnings, excluding bonuses, were 4.7% higher in the June-August period than a year earlier, the Office for National Statistics said, slightly weaker than an increase of 4.8% in the three months to July and the slowest since May 2022. Investors were fully pricing the BoE's next reduction in its benchmark Bank Rate in March, a month earlier than before Tuesday's jobs market data which suggested inflation pressures in the economy might be easing. Immediate resistance can be seen at 1.3368(Daily high), an upside break can trigger rise towards 1.3442(38.2%fib).On the downside, immediate support is seen at 1.3260(50%fib), a break below could take the pair towards 1.3226(Lower BB).
NZD/USD: The New Zealand dollar fell to a fresh six-month low on Tuesday as weak consumer spending data strengthened expectations for further policy easing. Electronic card spending declined 0.5% in September, defying analysts’ forecasts for a modest gain and suggesting that consumers have yet to respond to the Reserve Bank of New Zealand’s (RBNZ) series of rate cuts.The soft retail and spending figures underscored slowing consumer demand, raising concerns about the country’s growth outlook. The RBNZ reinforced its accommodative stance by loosening home-lending restrictions, a move likely aimed at supporting a subdued housing market.Markets now price in around an 85% probability of a rate cut to 2.25% in November, with some expectations that rates could fall further to 2.0%. Immediate resistance can be seen at 0.5761(Oct 10th high), an upside break can trigger rise towards 0.5806(50%fib).On the downside, immediate support is seen at 0.5683(38.2%fib), a break below could take the pair towards 0.5654(Lower BB).
USD/JPY: The U.S. dollar edged lower on Tuesday as the yen strengthened following remarks from Japan’s Finance Minister Katsunobu Kato. Kato said Japan must craft a new economic strategy tailored to current conditions, highlighting that inflation has now become a key concern, unlike the deflationary environment targeted by the earlier “Abenomics” framework.Commenting on the yen’s recent weakness, Kato reiterated that the government will closely monitor foreign exchange markets for signs of excessive volatility or disorderly movements. His remarks come as the Liberal Democratic Party’s newly elected leader, Sanae Takaichi, a strong advocate of Abenomics, is widely expected to continue reflationary and pro-growth policies. Immediate resistance can be seen at 153.42(23.6%fib) an upside break can trigger rise towards 154.00 (Psychological level) .On the downside, immediate support is seen at 150.96 (38.2%fib) a break below could take the pair towards 149.42 (SMA 20).
Equities Recap
European stocks slipped on Tuesday amid renewed U.S.-China trade concerns, while Michelin shares tumbled to a two-year low after the French tyre maker cut its annual forecast.
At (GMT 12:20),UK's benchmark FTSE 100 was last trading down at 0.41 percent, Germany's dax was down by 1.19 percent, France’s CAC was last down by 1.02 percent.
Commodities Recap
Gold surged to a record high above $4,100 on Tuesday, boosted by growing expectations of a U.S. Federal Reserve rate cut this month and renewed safe-haven demand amid escalating U.S.-China trade tensions.
Spot gold rose 0.5% to $4,129.16 per ounce by 1138 GMT, after hitting a record high of $4,179.48 earlier in the session.U.S. gold futures for December delivery rose 0.4% to $4,147.10.
Oil prices dropped over 2% on Tuesday amid rising U.S.-China trade tensions and after the International Energy Agency signaled the potential for higher supplies and slower demand growth.
Brent crude futures fell $1.46, or 2.3%, to $61.86 a barrel by 1108 GMT, while U.S. West Texas Intermediate crude was down 2.5%, or $1.46, at $58.03. Both contracts were at a five-month low
