Europe Roundup: Sterling falls against dollar after Bank of England raises its key interest rate, European stocks rise, Gold dips, Oil prices tick up on positive U.S. fuel demand data

Market Roundup

•France May Thomson Reuters IPSOS PCSI 42.54, 39.85 previous

•EU May Thomson Reuters IPSOS PCSI (MoM) 44.03,43.16 previous

•EU May Germany Thomson Reuters IPSOS PCSI 50.47, 50.29 previous

•Irish Apr HICP (YoY) 6.3%, 7.0% previous

•BoE May Interest Rate Decision 4.50%, 4.50% forecast,4.25% previous

•BoE Apr MPC vote unchanged 0, 2 forecast, 2 previous

•BoE Apr MPC vote cut 0, 0 forecast, 0 previous

Looking Ahead Economic Calander(GMT)

•12:30 US Mar PPI (MoM) 0.3% forecast,-0.5% previous

•12:30 US Initial Jobless Claims 245K forecast,242K previous

•12:30 US Continuing Jobless Claims 1,820K forecast, 1,805K previous

•12:30 US Jobless Claims 4-Week Avg. 220.35K forecast, 239.25K previous

•12:30 US Apr Core PPI (YoY) 3.3% forecast, 3.4% previous

•12:30 US Apr Core PPI (MoM) 0.2% forecast, -0.1% previous

•12:30 US Apr PPI ex. Food/Energy/Transport (MoM) 0.1% previous

•12:30 US Apr PPI (YoY) 2.4% forecast,2.7% previous

•12:30 US Apr PPI ex. Food/Energy/Transport (YoY) 3.6% previous

Looking Ahead Events Other Releases(GMT)

•17:30 EU ECB's De Guindos Speaks

Currency Forecast

EUR/USD: The euro declined on Thursday after data showed U.S. consumer prices in April rose at a slightly slower-than-expected pace, suggesting the Federal Reserve is succeeding in taming high inflation. Figures from the Labor Department showed U.S. consumer prices in April rising 4.9% from a year ago, compared with expectations of a 5% increase, potentially providing cover for the central bank to pause further interest rate hikes. Immediate resistance can be seen at 1.0962(5DMA), an upside break can trigger rise towards 1.1006(23.6%fib).On the downside, immediate support is seen at 1.0926 (38.2%fib ), a break below could take the pair towards 1.0902(Lower BB).

.GBP/USD: The pound eaased against dollar on Thursday after Bank of England raises rates to 4.5%. The Bank of England raised its key interest rate by a quarter of a percentage point to 4.5% on Thursday, taking borrowing costs to their highest since 2008 with its 12th consecutive rate rise, as it seeks to curb the fastest inflation of any major economy.The central bank no longer predicts recession after it revised up its growth forecasts from gloomy numbers released in February, the biggest such improvement since it first published forecasts in 1997. Sterling dipped 0.36% against the dollar to $1.2580, a touch below the $1.2679 it hit Wednesday, its highest since late April 2022.Immediate resistance can be seen at 1.2615 (5DMA), an upside break can trigger rise towards 1.2687 (23.6%fib).On the downside, immediate support is seen at 1.2562(38.2%fib), a break below could take the pair towards 1.2480(April 13th low).

USD/CHF: The dollar strengthened against Swiss franc on Thursday as gloomy data from China stoked concerns about deflation and the country’s pace of recovery. China's April consumer prices data rose at a slower pace and missed expectations, while factory gate deflation deepened, suggesting more stimulus may be needed to boost a patchy post-COVID economic recovery. The dollar which had taken a hit after a U.S. inflation report on Wednesday raised bets of a rate hike pause by the Federal Reserve, found its footing following the release of the Chinese data, which provided further evidence of the country’s weak post-pandemic recovery. Immediate resistance can be seen at 0.8962(30DMA), an upside break can trigger rise towards 0.9000 (38.2%fib).On the downside, immediate support is seen at 0.8876(23.6%fib), a break below could take the pair towards 0.8827(Lower BB).

USD/JPY: The dollars strengthened against Japan's yen on Thursday as investors assessed further clarity on the U.S. Federal Reserve's monetary policy path. The annual increase in U.S. consumer prices slowed to below 5% in April for the first time in two years, potentially providing cover for the U.S central bank to pause interest rate hike next month. Markets are currently pricing in a 95% chance of the Fed holding rates at their current level in June. Strong resistance can be seen at 134.34(Daily high) an upside break can trigger rise towards 135.48(38.2%fib).On the downside, immediate support is seen at 134.12(30DMA), a break below could take the pair towards 131.12(38.2%fib)

Equities Recap

European shares rose on Thursday, with media and travel stocks in the lead, as signs of easing U.S. inflation offered some relief to investors worried about the impact of the Federal Reserve's tight monetary policy.

At (GMT 11:54),UK's benchmark FTSE 100 was last trading down at 0.32percent, Germany's Dax was down by 0.18 percent, France’s CAC was trading up by 0.24 percent.

Commodities Recap

Gold prices extended losses to a second session on Thursday as the dollar advanced, while markets assessed U.S. inflation data to gauge the Federal Reserve’s next policy move.

Spot gold fell 0.1% to $2,026.99 per ounce by 1033 GMT, while U.S. gold futures ticked down 0.2% to $2,033.30.

Oil prices rose on Thursday, clawing back some of the previous day's losses, supported by fuel demand data from the United States, the world's top oil consumer.

Brent crude rose 52 cents, or 0.7%, to $76.93 a barrel by 0828 GMT while U.S. crude futures gained 48 cents, up 0.7%, to $73.04. Both contracts were on track for their first weekly percentage gain in four.