Posted at 23 May 2022 / Categories Market Roundups
•German May Current Assessment 99.5, 95.8 forecast, 97.2 previous
•German May Business Expectations 86.9, 83.5 forecast, 86.7 previous
• German May Ifo Business Climate Index 93.0, 91.4 forecast, 91.8 previous
•US Apr Chicago Fed National Activity 0.47,0.44 previous
•Belgium May NBB Business Climate 1.8, 2.4 previous
•French 12-Month BTF Auction 0.051%,-0.147% previous
•French 3-Month BTF Auction -0.603%,-0.628% previous
•French 6-Month BTF Auction -0.400%, -0.471% previous
Looking Ahead - Economic Data (GMT)
•15:30 US 3-Month Bill Auction 1.050% previous
•15:30 US 6-Month Bill Auction 1.490% previous
Looking Ahead - Economic events and other releases (GMT)
•16:15 UK BoE Gov Bailey Speaks
•14:15 German Buba President Nagel Speaks
EUR/USD: The euro rose against dollar on Monday after German data showed a resilient economy and European Central Bank President Christine Lagarde strengthened expectations about rates reaching zero or even positive territory by year-end. The ECB is likely to lift its deposit rate out of negative territory by the end of September and could raise it further if it sees inflation stabilising at 2%, Lagarde said on Monday. German business morale rose unexpectedly in May, as Europe’s largest economy showed resilience in the face of high inflation, supply chain problems and the war in Ukraine. Immediate resistance can be seen at 1.0682(38.2%fib), an upside break can trigger rise towards 1.0703 (Higher BB).On the downside, immediate support is seen at 1.0627 (30DMA), a break below could take the pair towards 1.0561 (23.6%fib).
GBP/USD: The pound rallied on Monday, persisting at more than two-week highs against a broadly weaker dollar, as traders await key data on the UK’s manufacturing industry this week. The strength of the pound is largely down to broad dollar weakness, as investors sold the U.S. unit on hopes that loosening lockdowns in China could help global growth. Strong labour numbers early last week had reinforced expectations that the BoE will need to continue raising interest rates to fight high inflation. Data on Friday showed British retail sales jumping unexpectedly in April. By 12:00 GMT sterling was up 0.46% against the dollar at $1.2567, its highest level since May 5.Immediate resistance can be seen at 1.2605(38.2%fib),an upside break can trigger rise towards 1.2675(Higher BB).On the downside, immediate support is seen at 1.2427 (5DMA), a break below could take the pair towards 1.2439 (23.6%fib).
USD/CHF: The dollar declined against the Swiss franc on Monday as investors worried inflation and rising interest rates would hamper the global economy’s performance. The concerns over global economic growth have prompted renewed support for safe haven Swiss franc. The dollar index, which tracks the U.S. unit against a basket of currencies of other major trading partners, was down 0.7% at 102.19. The index rose by about 16% to a two-decade high over the 12 months to mid-May. Immediate resistance can be seen at 0.9772(38.2%fib), an upside break can trigger rise towards 0.9785 (5DMA).On the downside, immediate support is seen at 0.9662(50% fib), a break below could take the pair towards 0.9582 (Higher BB ).
USD/JPY: The dollar edged lower against the Japanese yen on Monday as investors kept up selling pressure, cutting bets on further dollar gains from rising U.S. rates. St. Louis Federal Reserve Bank President James Bullard reiterated his view last week that the U.S. central bank ought to raise interest rates to 3.5% this year to get high inflation more quickly under control. The dollar index, which tracks the U.S. unit against a basket of currencies of other major trading partners, was down 0.3% at 102.60. Strong resistance can be seen at 128.14(5DMA), an upside break can trigger rise towards 129.21(23.6fib).On the downside, immediate support is seen at 127.15 (38.2%fib), a break below could take the pair towards 125.43(50%fib).
European stocks were broadly higher on Monday, as the financial hub of Shanghai lifted some of its COVID-19 restrictions and U.S. President Joe Biden said he was weighing cutting tariffs on Chinese goods.
At (GMT 13:15 ),UK's benchmark FTSE 100 was last trading up at 1.29 percent, Germany's Dax was up by 1.00 percent, France’s CAC was last up by 0.15 percent.
Oil prices gained on Monday with U.S. fuel demand, tight supply and a slightly weaker U.S. dollar supporting the market, as Shanghai prepares to reopen after a two-month lockdown that fuelled worries about a sharp slowdown in growth.
Brent crude futures rose $1.06 or 0.9% to $113.61 a barrel by 1240 GMT, while U.S. West Texas Intermediate (WTI) crude futures climbed 97 cents, or 0.9%, to $111.25 a barrel, adding to last week's small gains for both contracts.
Gold prices rose over 1% on Monday, boosted by a slide in U.S. dollar to its lowest in a month, while growth concerns in the economy kept bullion’s safe-haven demand intact.
Spot gold rose 0.7% to $1,857.89 per ounce by 1238 GMT. Prices hit their highest since May 9 at $1,865.29 earlier in the session. U.S. gold futures gained 0.8% to $1,856.70.