Author: FX
The Federal Reserve, the Bank of England and the European Central Bank (ECB) will have their policy meetings next week. Market participants expect a 50 basis points rate hikes and to signal it will continue raising rates. Analysts at Rabobank, point out that a 50bp rate hike is all but a given for next week. They still expect the ECB can scale back to 25bp hikes from March, but the stronger outlook and wage pressures could delay this and pose upside risks. Hawks still have an upper hand, but are no longer getting carte blanche “The ECB’s hawks are still…
Adam Button Friday, 27/01/2023 | 16:13 GMT-0 27/01/2023 | 16:13 GMT-0 Every time oil hits $83 and fades, the importance of that level grows.The WTI crude oil Crude Oil Crude oil is the most popular tradable instrument in the energy sector, offering exposure to global market conditions, geopolitical risk, and economics. The instrument is strategically relied upon and situated in the global economy. Crude oil has proven to be a unique option for traders given volatility and the efficacy of both swing trading and longer-term strategies. Despite its popularity, crude oil is a very complex investing instrument, given the litany…
The EUR/CHF pair has climbed back above parity over the past week after bouncing off support for the 200-day moving average at around 0.9930, explained analysts at MUFG Bank. They see that price action supports their view that there is still room for the cross to rise back towards the levels that were in place during the second quarter of last year at closer to the 1.0500-level. Key quotes: “Euro-zone economies are proving more resilient over the winter period, and leading indicators such as the PMI surveys released over the past week have further dampened recession fears. The warmer winter…
The Canadian government is out with its latest budget numbers and they’re stark, thanks to much lower spending and a boost from resource revenues. The April-November budget deficit is C$3.55 billion compared to C$73.7 billion a year ago.To be clear, a decade ago a year-long deficit of $10 billion was seen as a large number and the pre-pandemic 2018-2019 deficit was $14.0 billion. Given interest rates, the deficits are likely to tick up but there are certainly no red flags for the loonie right now. You even have to wonder if Trudeau opens up the spending taps again. Source link
The US dollar has turned higher and equities are back in negative territory. It’s been a choppy session and I don’t rule out some dollar demand ahead of the London fix for the latest price action.EUR 15 minsI continue to worry we will see angst ahead of the FOMC decision on Wednesday and there is also a big week for corporate earnings coming up. Source link
Next Wednesday, the FOMC will announce its decision on monetary policy. Analysts at Rabobank point out it has become increasingly likely that the Fed will slow down its hiking cycle to 25 bps. Decline in inflation has increased the probability of smaller hikes “The next meeting of the FOMC, on January 31 and February 1, takes place against the backdrop of falling inflation and signs of a weakening economy. What’s more, the annual rotation of regional bank presidents with voting rights is expected to lead to a more dovish set of voters. Therefore, it has become increasingly likely that the…
China is certainly seen as the manufacturing hub of the world but there’s one area of global production that’s largely untouched and it’s the biggest one: Automotive.There aren’t many countries where you would see an Chinese built or designed vehicle on the roads but that may soon change, and it could be far more disruptive than Tesla.Brad Setser from the CFR today highlights how China has gone from a net importer of vehicles to an exporter with remarkable speed, building an array of local EV brands.”China has suddenly become a major global competitor,” he writes.The US has been shocked by…
US Dollar climbs as the Federal Reserve preferred gauge for inflation, with core PCE creeping lower. According to the University of Michigan (UoM) poll, US consumers’ inflation expectations edged lower. Gold Price Analysis: The rally from $1,616.71 to $1,949.16 could end, as a doji emerged in the weekly chart. Gold price falls for the second consecutive day, but it remains above January’s 26 low of $1,918.74 and stays sideways, following the release of inflation data in the United States (US). The US Dollar (USD) shortened its drop during the week, while US Treasury bond yields are rising, two additional reasons…
Mexican Peso among top performers on Friday. UUSD/MXN slide found support above 18.70 as DXY strengthens after the beginning of the American session. US data mostly in line with expectations on Friday. The USD/MXN dropped on Friday to 18.71, reaching the lowest level since January 18 and then rebounded, erasing daily losses after the greenback gained momentum following Wall Street’s opening bell. The dollar remains weak against emerging market currencies as equity and commodity markets rise. The Mexican Peso is outperforming its EM peers on Friday, although it pulled back during the last hour. US yields moved higher during the…
In this episode, we explain what you need to know from the first of the big tech companies to report their corporate earnings this season, Microsoft. We dive into the numbers and explain what they all mean and why investors are most interested in the performance of their cloud computing division. Elsewhere, Citadel has leaped past Bridgewater Associates to be crowned the top hedge fund manager in 2022, making an incredible $16bn profit for investors last year! But who is Citadel and how do they make their money? We finish on why WhatsApp is getting employees at Morgan Stanley in…