News

Europe Roundup: Sterling strengthens against dollar after UK CPI data, European shares gain, Gold off one-week lows, Oil highest since 2014 as Turkey outage adds to tight supply outlook-January 19th,2022

Posted at 19 January 2022 / Categories Market Roundups


Market Roundup

•UK Dec Core CPI MoM (MoM)  0.5%,0.2% forecast, 0.5% previous

•UK Dec CPI (YoY)   5.4%,5.2% forecast,5.1% previous

•UK Dec  CPI (MoM)  0.5%,0.3% forecast,0.7% previous 

•UK Dec PPI Input (MoM)   -0.2%,0.7% forecast,1.5% previous

• German Dec CPI (MoM)  0.5%,0.5% forecast,-0.2% previous    

• German Dec CPI (YoY)  5.3%,5.3% forecast, 5.2% previous

• EU Nov Current Account  23.6B, 18.1B  previous             

• EU Nov Current Account n.s.a. 25.9B,20.5B previous

Looking Ahead - Economic Data (GMT)

•13:30 US Dec Building Permits  1.701M forecast ,1.717M previous            

•13:30 US Dec Building Permits (MoM)  3.9% previous

•13:30 US Dec Housing Starts (MoM)  11.8% previous      

•13:30 US Dec Housing Starts 1.679M forecast, 1.679M previous

•13:30 Canada Dec Core CPI (MoM)  0.6%  previous

•13:30 Canada Dec Core CPI (YoY)  3.5%, 3.6%previous

•13:30 Canada Dec CPI (MoM)  -0.1% forecast,0.2% previous

•13:30 Canada Nov Wholesale Sales (MoM)  2.7% forecast, 1.4% previous             

Looking Ahead - Economic events and other releases (GMT)

•14:15 UK BoE Gov Bailey Speaks                              

•14:15 UK BoE MPC Member Cunliffe Speaks

Fxbeat

EUR/USD: The euro edged higher against dollar on Wednesday as  moves were limited  as the market looked to U.S. Federal Reserve's next policy meeting. Investors are awaiting the Federal Reserve's Jan. 25-26 meeting for hawkish signals as markets now bet on at least four hikes this year, likely starting in March. The dollar was slightly lower, holding near a weekly high, after a surge in U.S. yields resulted in sharp gains this week against the euro amid growing bets the Federal Reserve will raise rates. The euro was flat, back on its 50-day moving average at $1.1333 after in the previous day it had its sharpest daily drop in a month. Immediate resistance can be seen at 1.1347 (38.2%fib), an upside break can trigger rise towards 1.1385 (23.6%fib).On the downside, immediate support is seen at 1.1318 (50%fib), a break below could take the pair towards  1.1286 (61.8% fib).

GBP/USD: Sterling strengthened against dollar on Wednesday after higher-than-expected British inflation data added to pressure on the Bank of England to raise interest rates next month. Inflation in Britain rose faster than expected to a near 30-year high in December, intensifying a squeeze on living standards and putting pressure on the Bank of England to raise interest rates again. The annual rate of consumer price inflation increased to 5.4% from November's 5.1%, the highest since March 1992. Financial markets now price in a more than 90% chance that the BoE will raise its main interest rate to 0.5% on Feb. 3. Immediate resistance can be seen at 1.3634(38.2%fib), an upside break can trigger rise towards 1.3709(23.6%fib).On the downside, immediate support is seen at 1.3573 (50%fib), a break below could take the pair towards 1.3539 (21DMA).

USD/CHF: The dollar edged lower against the Swiss franc on Wednesday as traders braced for the Federal Reserve to be more aggressive in tightening monetary policy to tackle inflation. The dollar has been boosted by U.S. Treasury yields rising further ahead of next week's Federal Reserve policy meeting.Ten-year Treasury yields inched up on Wednesday to touch a new two-year high of 1.9%. At 11:02 GMT, the dollar was 0.18 percent lower versus the Swiss franc at 0.9155. Immediate resistance can be seen at 0.9168 (21 DMA), an upside break can trigger rise towards 0.9202(23.6% fib).On the downside, immediate support is seen at 0.9149 (38.2% fib), a break below could take the pair towards 0.9105 (50%fib).

USD/JPY: The dollar initially declined against the Japanese yen on Wednesday but recovered ground as the market looked to U.S. Federal Reserve's next policy meeting where it is widely expected to raise rates in an attempt to quell surging inflation. Global investor attention remains fixed on the Fed's Jan. 25-26 meeting after officials signalled they would start raising interest rates in March to curb inflation. At 11:07 GMT, the dollar was 0.09 percent lower versus the yen at 114.48 . Strong resistance can be seen at 114.86 (38.2% fib), an upside break can trigger rise towards 115.46 (23.6% fib).On the downside, immediate support is seen at 114.38 (50%fib), a break below could take the pair towards 113.87 (61.8%fib).

Equities Recap

European shares rose on Wednesday as luxury stocks stood out on upbeat trading updates from Richemont and Burberry.

At (GMT 11:07 ),UK's benchmark FTSE 100 was last trading up at 0.23 percent, Germany's Dax was up  by 0.33 percent, France’s CAC finished was up by 0.71 percent.

Commodities Recap

Gold edged up on Wednesday, but moves were fairly contained as the market looked to U.S. Federal Reserve's next policy meeting where it is widely expected to raise rates in an attempt to quell surging inflation.

Spot gold rose 0.2% to $1,816.80 per ounce as of 1022 GMT. U.S. gold futures gained 0.3% to $1,817.

Oil prices rose for a fourth day on Wednesday as an outage on a pipeline from Iraq to Turkey increased concerns about an already tight supply outlook amid worrisome geopolitical troubles in Russia and the United Arab Emirates.

Brent crude futures rose 39 cents, or 0.5%, to $87.90 a barrel at 0740 GMT, adding to a 1.2% jump in the previous session.


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