Market Roundup
• Italian 10-Year BTP Auction 3.37%, 3.57% previous
• Italian 15-Year BTP Auction 3.93%,88% previous
• Italian 3-Year BTP Auction 2.73%, 2.68% previous
• Italian 7-Year BTP Auction 3.23% ,3.19% previous
• German 10-Year Bund Auction 2.380% ,2.310% previous
• Portuguese CPI (MoM) (Oct) 0.1% ,0.1% previous
• Portuguese CPI (YoY) (Oct) 2.3%, 2.3% previous
Looking Ahead Economic Data(GMT)
• 13:30 US Core CPI (MoM) (Oct) 0.3% forecast, 0.3% previous
• 13:30 USD Core CPI Index (Oct) 320.77 previous
• 13:30 USD CPI (YoY) (Oct) 2.6% forecast, 2.4% previous
• 13:30 USD CPI (MoM) (Oct) 0.2% forecast, 0.2% previous
• 13:30 USD CPI Index, n.s.a. (Oct) 315.59 forecast , 315.30 previous
• 13:30 USD CPI Index, s.a. (Oct) 314.69 previous
• 13:30 USD CPI, n.s.a (MoM) (Oct) 0.16% previous
• 13:30 USD Real Earnings (MoM) (Oct) -0.1% previous
• 13:55 USD Redbook (YoY) 6.0% previous
• 16:00 USD Cleveland CPI (MoM) (Oct) 0.3% previous
• 16:00 USD Thomson Reuters IPSOS PCSI (Nov) 55.63 previous
Looking Ahead Economic Data(GMT)
• 13:30 USD FOMC Member Kashkari Speaks
•14:30 USD FOMC Member Williams Speaks
•14:35 USD Fed Member Logan Speaks
Currency Forecast
EUR/USD: The euro strengthened against the dollar on Wednesday as investors awaited crucial inflation data from the world's biggest economy. U.S. Consumer Price Index (CPI) data is due at 1330 GMT.Besides that, U.S. Producer Price index (PPI) and weekly jobless claims are due on Thursday, and retail sales data to end the week. Economists polled expect U.S. year-on-year inflation rose to 2.6% last month. Fed Chair Jerome Powell is scheduled to speak this week, ahead of U.S. Producer Price Index (PPI) data on Thursday and retail sales on Friday.Markets currently have about a 60% chance of another quarter basis point cut from the Fed priced in for December, down from around 84% a month ago, according to CME Group's FedWatch Tool. Immediate resistance can be seen at 1.0732(Daily high), an upside break can trigger rise towards 1.0761(38.2%fib).On the downside, immediate support is seen at 1.0600`(Psychological level), a break below could take the pair towards 1.0583(Lower BB)
GBP/USD: The sterling remained near three-month lows against a stronger dollar on Wednesday, following a sharp decline in the previous session after UK inflation data showed signs of easing. Sterling slipped 0.1% to $1.2795, just above its lowest level since early August, which hit $1.2719 on Tuesday. This came after data revealed that regular pay for British workers grew at its slowest pace in two years in the third quarter, reinforcing the Bank of England’s belief that inflationary pressures will continue to moderate. Last week, the BoE cut interest rates for the second time since 2020 and indicated that the Labour government’s first budget would likely lead to higher inflation and economic growth. As a result, traders are currently pricing in just a 15% chance of another 25-basis-point rate cut in December. Immediate resistance can be seen at 1.2832(38.2%fib), an upside break can trigger rise towards 1.2872(Nov 12th high).On the downside, immediate support is seen at 1.2717 (23.6%fib), a break below could take the pair towards 1.2663 (Aug 8th low).
AUD/USD: The Australian dollar hovered near a three-month low on Wednesday, weighed down as the U.S. dollar gained strength from rising Treasury yields. On the data front, Australian wages rose at the slowest annual pace since late 2022 in the third quarter amid an influx of new workers and an easing in inflation, adding somewhat to the case for cuts in interest rates. Figures from the Australian Bureau of Statistics on Wednesday showed its wage price index rose 0.8% in the September quarter, just under market forecasts for a 0.9% rise. At GMT 12:14, the Australian dollar was down 0.12 % at 0.6524 against US dollar. Immediate resistance can be seen at 0.6537(Daily high), an upside break can trigger rise towards 0.6571(38.2%fib).On the downside, immediate support is seen at 0.6509 (23.6%fib), a break below could take the pair towards 0.6481(Lower BB).
USD/JPY: The dollar strengthened against the yen on Wednesday as traders focused on upcoming inflation data for insights into the pace of potential Federal Reserve rate cuts. A stronger-than-expected U.S. consumer price index (CPI) later in the day could further reduce the chances of an imminent rate cut, with economists forecasting a 0.3% monthly increase in the core CPI. Meanwhile, Japan's wholesale inflation surged in October at its fastest annual pace in over a year, driven by renewed yen declines that raised import costs for certain goods, complicating the Bank of Japan's decision on when to raise interest rates.. The dollar edged up to as high as 154.94 yen for the first time since July 30 before last changing hands at 154.56 yen. Immediate resistance can be seen at 155.48(23.6 %fib) an upside break can trigger rise towards 156.16(Higher BB). On the downside, immediate support is seen at 154.54(Daily low) a break below could take the pair towards 153.37(38.2%fib).
Equities Recap
European shares fluctuated between gains and losses on Wednesday, as rising energy stocks offset declines in the technology sector. The market's attention remained fixed on a crucial U.S. inflation report, which could shift expectations regarding the Federal Reserve's interest rate trajectory.
At (GMT 12:27),UK's benchmark FTSE 100 was last trading down at 0.04 percent, Germany's Dax was down by 0.11 percent, France’s CAC was last down by 0.09 percent.
Commodities Recap
Gold prices rebounded on Wednesday, fueled by bargain hunting after the metal had dropped to its lowest level in nearly two months in the previous session as uptick came as the dollar paused its recent gains
Spot gold was up 0.4% at $2,607.99 per ounce by 1133 GMT, after hitting its lowest since Sept. 20 on Tuesday. U.S. gold futures rose 0.3% to $2,613.90.
Oil prices inched higher on Wednesday, driven by signs of near-term supply tightness, but remained close to their lowest levels in two weeks. This followed OPEC's downgrade of its global oil demand growth forecast for 2024 and 2025.
Brent futures rose 17 cents, or 0.24%, to $72.06 a barrel by 0420 GMT, while U.S. West Texas Intermediate (WTI) crude futures gained 14 cents, or 0.21%, at $68.26.
