Market Roundup
•Sweden Manufacturing PMI (Dec): 55.3, 54.7 previous.
•EU HCOB Spain Manufacturing PMI (Dec): 49.6, 51.2 forecast, 51.5 previous.
•EU HCOB Italy Manufacturing PMI (Dec): 47.9, 50.0 forecast, 50.6 previous.
•EU HCOB France Manufacturing PMI (Dec): 50.7, 50.6 forecast, 47.8 previous.
•EU HCOB Germany Manufacturing PMI (Dec): 47.0, 47.7 forecast, 48.2 previous.
•EU HCOB Eurozone Manufacturing PMI (Dec): 48.8, 49.2 forecast, 49.6 previous.
•EU M3 Money Supply YoY (Nov): 3.0%, 2.7% forecast, 2.8% previous.
•EU Loans to Non-Financial Corporations (Nov): 3.1%, 2.9% previous.
•EU M3 Money Supply (Nov): 17,189.3B, 17,085.8B previous.
•EU Private Sector Loans YoY (Nov): 2.9%, 2.8% forecast, 2.8% previous.
Looking Ahead Economic Data (GMT)
•14:30 Canada S&P Global Manufacturing PMI (Dec): 48.4 previous.
•14:45 US S&P Global Manufacturing PMI (Dec): 51.8 forecast, 52.2 previous.
•15:00 US Construction Spending MoM (Oct): -0.1% forecast, 0.2% previous.
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD : The euro dipped on Friday as investors braced for a year likely to feature a leadership transition at the Federal Reserve and the prospect of increased market volatility under Donald Trump’s presidency. Early-year focus is also on who Trump will nominate as the next Fed Chair, with current Chair Jerome Powell’s term set to end in May.Markets expect Trump’s pick to be more dovish, increasing the likelihood of rate cuts after the president repeatedly criticised the Fed and Powell last year for not easing policy more quickly or aggressively. Traders are currently pricing in two rate cuts this year, compared with just one projected by a divided Fed. The dollar index, which measures the U.S. currency against six other units, was up 0.2% on Friday at 98.39 after registering a 9.4% decline in 2025, its biggest drop in eight years. Immediate resistance can be seen at 1.1793(23.6%fib), an upside break can trigger rise towards 1.1828(Higher BB).On the downside, immediate support is seen at 1.1731(38.2%fib), a break below could take the pair towards 1.1680(50%fib).
GBP/USD: Sterling traded flat against the dollar on Friday as thin liquidity kept trading subdued at the start of 2026. Trading in Britain has been light over the Christmas and New Year period, with activity expected to pick up only next week.Currency movements have largely reflected easing concerns over the UK budget and Bank of England policy in recent weeks.The BoE cut its interest rate last month in a narrow 5-4 vote, while signaling that its already gradual pace of easing could slow in 2026.Money market traders are not fully pricing in another rate cut until June, with expectations of just 40 basis points of easing this year implying roughly a 60% chance of a second quarter-point reduction by year-end.. Immediate resistance can be seen at 1.3499(23.6%fib), an upside break can trigger rise towards 1.3529(Higher BB).On the downside, immediate support is seen at 1.3405 (38.2%fib), a break below could take the pair towards 1.3338(50%fib).
AUD/USD: The Australian dollar firmed as Australian dollar was supported by increasing bet that RBA next move on interest rates will be a hike.Expectations of a more hawkish stance from the RBA emerged after the release of the December 9 monetary policy minutes , where policymakers discussed the possibility of interest rate hike this year.Focus will shift to the Q4 CPI data on January 28, where an upside surprise in core inflation could trigger a move at the RBA’s February 3 meeting. The probability of a quarter-point rise in the Reserve Bank of Australia's 3.6% cash rate is put at 18% for February, lifting to 70% for May. A move in August is almost fully priced.The Australian dollar closed out 2025 on a strong footing, rising nearly 8% for the year its best annual performance since 2020. Immediate resistance can be seen at 0.6695(23.6%fib), an upside break can trigger rise towards 0.6726(Higher BB).On the downside, immediate support is seen at 0.6654(Daily low), a break below could take the pair towards 0.6609(38.2%fib)
USD/JPY: The U.S. dollar edged higher on Friday as the yen weakened as investors assessed the Bank of Japan’s cautious approach to monetary tightening. While the BoJ remains committed to its tightening plan, it has offered little clarity on the timing of the next interest-rate hike.Japan’s verbal warnings last month briefly kept the yen out of intervention territory, with Finance Minister Katayama stressing the country’s freedom to act against excessive currency moves. However, concerns over further yen weakness persist. Business lobby leaders have since urged the government to take steps to address the currency’s decline and support a stronger yen.Japan’s expansive fiscal policy also remains a source of concern, with public debt already exceeding twice the size of the economy. Immediate resistance can be seen at 157.80(23.6%fib) an upside break can trigger rise towards 158.00(Psychological level) .On the downside, immediate support is seen at 155.91 (SMA 20) a break below could take the pair towards 155.61 (38.2%fib).
Equities Recap
European stocks opened 2026 at record highs as investors brace for an AI-led rally, a Fed leadership change, increased government spending, and potential Trump-era market turbulence.
At (GMT 13:38),UK's benchmark FTSE 100 was last trading up at 0.66 percent, Germany's Dax was up by 0.44 percent, France’s CAC was last up by 0.72 percent.
Commodities Recap
Spot gold climbed 1.7% to $4,387.58 per ounce, as of 1322 GMT, after hitting a record high of $4,549.71 on December 26.It had dropped to a two-week low on Wednesday.
U.S. gold futures for February delivery gained 1.3% to $4,399.20/oz.
Oil prices fell on the first day of 2026 after posting their biggest annual loss since 2020, as oversupply concerns weighed against geopolitical risks in Ukraine and Venezuela.
Brent crude futures lost 51 cents to $60.34 a barrel by 1350 GMT on Friday while U.S. West Texas Intermediate crude was down 52 cents at $56.90.
