FxWirePro: Forex Weekly Update 

The US dollar index direction was determined by previous Fed monetary policy. The policymaker kept its rates unchanged as expected and trimmed the forecast of GDP growth and inflation. Fed dot plot shows that there will 3 rate cuts in 2024 (0.75%).
US retail sales and jobless claims beat market expectations. While US inflation came in line with expectations.  According to the CME Fed watch tool, the probability of a 25 bpbs rate cut in Jan increased to 10.3% from 4% a week ago.

 The US 10-year yield declined below 4% on rate cut hopes. The US 10 and 2-year spread narrowed to --50% from -39%.

Major resistance- 102.65/103.20

Major support- 101.70/101.

EURUSD- 
 
EURUSD pared some of its gains on profit booking. The pair performed well after the hawkish rate pause by the ECB. Markets eye German IFO business climate data for further movement.

Major resistance- 1.0965,1.1020

Major support- 1.08600,1.0800

Yen- 

USDJPY showed a minor pullback ahead of the BOJ policy meeting. The pair was one of the worst performers the previous week and lost more than 300 pips. 

Major Resistance- 142.50,143

Major support- 141.50,140.80

Pound sterling

The pound sterling jumped sharply after a cautious rate pause by BOE.the central bank kept its rates unchanged at 5.25%  with a 6-3 vote where three members opted for a 25 bpbs rate hike. UK GDP and UK manufacturing PMI show growth is stagnant. 

Major Resistance- 1.2750,1.2800

Major support- 1.2650,1.2600

Economic calendar - 

Dec 19th, 2023, BOJ Policy rate (12:30 am GMT)

              Canada CPI  (1:30 pm GMT)

 Dec 20th 2023,   UK CPI y/y (7:00 am GMT)
                   
                                US CB consumer confidence  (3 pm GMT) 

Dec 21st 2023, US Final GDP q/q (1:30 pm GMT)

Dec 22nd, 2023, Core PCE index  (1:30 pm GMT)
                              
                  Core durable goods order 

                  US new home sales (3 pm GMT)