uk inflation

Weekly Recap

It was another bearish week for the US Dollar as the greenback continued to sell off from YTD highs. The FOMC meeting minutes, released mid-week, did little to inspire a fresh rally in the Dollar. While the minutes confirmed the Fed’s hawkish stance and reinforced expectations for further 50bps hikes in June and July, there was little in the way of exciting details to get bulls reinvigorated. Additionally, with the Fed having seemingly turned more hawkish since that meeting, the minutes felt a little outdated.

Fed | What Is Fed? | USD

Christine Lagarde, ECB And Rate Hikes

On the data front, a string of weaker-than-expected indicators out of the eurozone heightened growth concerns. With ECB’s Lagarde essentially confirming a July rate-hike, recession fears weighed on European asset markets though EUR itself remained well bid. Elsewhere, equities markets generally saw a choppy week though most indices ended the week in the green, benefitting from the weaker US Dollar.

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UK inflation reaches 30 year high

UK inflation reaches 30 year high

Walid Koudmani Walid Koudmani 19.01.2022 12:08
While the government and Bank of England have attempted to deal with the rise in prices and creeping inflation, today's figures continue to show that the path forward may be longer than expected. While a slight adjustment in monetary policy may contribute, today’s data showed the highest level in 30 years as the economy is still recovering from the pandemic and could take a significant amount of time to return to normal levels. Ultimately, this situation continues to impact everyday consumers who may see some very noticeable changes to their lifestyle and expenses if the ongoing trend continues. Crypto markets retreat as investors worry about increased regulation and central bank decisions Crypto markets along with other traditional risk assets continue to feel the pressure of incoming fiscal and monetary policy changes from central banks which is due to remove some of the excess liquidity from markets after the unprecedented support received by them, However, crypto is currently dealing a wide variety of negative news and potential increases in regulations which have contributed to the recent pullback across assets as Ethereum continues to hover above the key $3000 psychological level. While fundamental factors may have changed slightly, the second biggest coin is trading at the lowest level in several months and as traders await a catalyst, the situation remains potentially quite volatile. Activision Blizzard acquisition by Microsoft could be a game changer This $68,7 Billion deal could prove to be a turning point for Activision Blizzard, who has seen its share price drop more than 44% in the last year on the back of disappointing results and a number of corporate as well as internal issues. Microsoft announced it will be offering as many Activision Blizzard games as possible within Xbox Game Pass and PC Game Pass, which just reached 25 million subscribers, and might provide the much needed boost in player base. Furthermore, a more direct input in general operations decisions could aim to rectify decisional issues and bring a more united direction for the company moving forward. Investors already reacted to this news favourably with Activision Blizzard stock price gaining over 30% on Tuesday while Sony stock actually fell as shareholders consider the risks associated with this acquisition.  
Swissquote MarketTalk: A Look At XAUUSD, Swiss Secrets, Tesla And More

Russia And Ukraine Conflict Fuelling Markets. Awaiting The US PPI And UK Inflation Indicators

Swissquote Bank Swissquote Bank 14.02.2022 11:11
The week starts on quite a tense note as the tensions between Ukraine and Russia don’t seem to be headed in the right direction with reports on Friday hinting at the possibility of a Russian invasion before ‘the end of the Beijing Olympics’. European equities are deep in the red, with FTSE 100 somehow doing less bad than the others on rising energy and commodity prices, but the Euro Stoxx is already down 2.33% and the DAX by 2.85%. US crudes flirts with the $95 per barrel, and gold welcomes decent safe-haven capital. While US sovereigns, energy and gold are the favorite destinations for those who are seeking protection in the actual environment, any relief on the Ukrainian front could send the recent gains in oil and gold crumbling. On the economic agenda: US PPI and FOMC minutes will be closely watched. We know that engineering a policy that would bring inflation down to the 2% target in the US would also bring an unnecessary stress on the market and on the economy. Would that help cooling the Fed hawks? Watch the full episode to find out more! 0:00 Intro 0:26 Market update 2:19 Rising oil also fears central bank hawks 3:28 Gold, the safe haven 4:48 Bitcoin under pressure 5:42 Economic calendar: US PPI, FOMC minutes, UK, CAD, JP inflation 8:04 Corporate calendar: Nvidia, Walmart, Roblox Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
What Today's NFP Means For Markets? High Value May Boost USD, But Weaken Gold Price. Low NFP May Help Stockmarket | Oanda

Tightening Alert! How Have Exchange Rates Of Singapore Dollar (SGD), NZD, Canadian Dollar And Korean Won (KRW) Changed?

Marc Chandler Marc Chandler 14.04.2022 13:47
April 14, 2022  $USD, Australia, BOC, China, Currency Movement, ECB, Japan, Turkey, UK Overview: What appears to be a powerful short-covering rally in the US debt market has helped steady equities and weighed on the dollar.  Singapore and South Korea joined New Zealand and Canada in tightening monetary policy.  Attention turns to the ECB now on the eve of a long-holiday weekend for many members.  The tech-sector led the US equity recovery yesterday, snapping a three-day decline.  Most of the major markets in Asia Pacific advanced but Taiwan and India.  Europe's Stoxx 600 is posting small gains for the second day, and US futures are little changed.  The 10-year Treasury yield is a little softer at 2.69%.  It peaked on April 12 near 2.83%.  The two-year yield is almost one basis point lower to about 2.34%.  It peaked on April 6 around 2.60%.  The drop in US yields yesterday and softer than expected jobs data conspired to a 10 bp drop in Australia's 10-year yield.  European yields are 3-4 bp higher, with the periphery leading, perhaps on ideas that the ECB will signal the end of its bond-buying.  The dollar is mostly heavier against the major currencies, with the Swedish krona and New Zealand dollar the strongest.  Among emerging market currencies, those from central Europe have been helped by the euro's bounce.  The high-flying South African rand and Mexican peso have come back a bit lower.  Gold is softer but consolidating inside yesterday's range.  June WTI is pulling back a little after testing the $104 area.  US natgas prices are higher for the fourth session and have risen by around 58% since mid-March.  Europe's benchmark is off about 3% and is near its lowest level since March 25.  Iron ore rose 1.6% after yesterday's 2.5% decline as the sawtooth pattern of alternating gains/declines this week continues.  July copper is edging higher for the third session.  July wheat is struggling after four days of gains.   Asia Pacific Australia's March employment report fell shy of expectations.  Overall, employment rose by 18k, not the 30k the median forecast (Bloomberg survey) anticipated.  Full-time positions rose by 20.5k after increasing by nearly 122k in February.  The unemployment rate was steady at 4.0% rather than slipping as expected.  The participation rate was steady at 66.4%.  It had been expected to increase slightly.  Separately, the Melbourne Institute's measure of inflation expectations rose to a new high of 5.2% from 4.9%.  The central bank is waiting for stronger signs of wage pressures to build before lifting rates, but this risks putting it further behind the curve.  A rate hike is expected after next month's election.   How are Japanese investors responding to the slide in the yen?   For the 10th week of the past 11, Japanese investors have been selling foreign bonds.  US Treasuries are their largest holding, so the divestment hit them hardest.  Given the developments in the foreign exchange market, the repatriation of unhedged proceeds buys more yen.  Sometimes in the past, it appears that the weakness of the yen encouraged Japanese investors to export more savings.   The market will be disappointed if China's benchmark one-year medium-term lending facility rate is not cut tomorrow.   It was last cut by 10 bp to 2.85% in January.  This was the first cut since the pandemic struck in early 2020.  The MLF rate was cut by 20 bp in April 2020 after a 10 bp cut in February.  Covid and the associated lockdowns are hitting an economy that already appeared to be struggling.  More than a token 10 bp cut is necessary.  There are heightened expectations for a cut in reserve requirements as soon as next week.  Prime loan rates may also be reduced next week.  China reports Q1 GDP early next week.  It has expected to have slowed to 0.7% quarter-over-quarter after growing 1.6% in Q4 21.   The pullback in US yields has helped the yen stabilize after sliding for the past nine consecutive sessions.   Still, the greenback has found support ahead of JPY125.00.  A break of the JPY124.80 area is needed to signal anything important technically.  On the upside, the JPY125.60-JPY125.70 area may offer an immediate cap.  Support at $0.7400 for the Australian dollar frayed yesterday but it recovered to almost $0.7470 today before new offers proved too much.  It is finding support in the European morning near $0.7440.  The Chinese yuan has not drawn much benefit from the heavier US dollar.  The greenback did make a new low for the week near CNY6.3625 but recovered and resurfaced above CNY6.3700. The PBOC set the dollar's references rate slightly lower than expected at CNY6.3540 (vs. median forecast in Bloomberg's survey for CNY6.3547).  Europe The ECB meets amid claims by its first chief economist Issing that its approach to inflation has been misguided.   The preliminary estimate of last month's CPI was 7.5% (3% core) year-over-year.  At the same time, growth forecasts are being cut. There has also been a serious blow to consumer and business confidence.  Monetary policy, as is well appreciated, has impact with variable lags.  That is partly why simply subtracting inflation from the bond yield may not be the most robust way to think about real interest rates.  Nominal rates should be adjusted for inflation expectations.  In any event, the takeaway from the ECB meeting will be about the forward guidance on its asset purchases. Does it pullback from last month's decision in which it indicated its monthly bond purchases here in Q2 or does it commit to suspending the Asset Purchases Program at the end of the quarter?  What about the other policy tool discussed in the press that would give the ECB a way to counter a surge in yields that could lead to diverging rates?  It seems like it is not imminent, but more importantly this may be an effort to modify the Outright Monetary Transactions facility that Draghi launched.  Note that there were conditions attached and although the facility has not been used, it seemed to have helped ease the crisis mentality. It reveals something about the power of the communication channel.   Turkey's central bank sets the one-week repo rate today and it is likely to remain at 14%.   What may prove more interesting are the weekly portfolio flows.  In the week ending April 1, foreign investors were net buyers of Turkish bonds for the first time in six weeks. The $104 mln was slightly more than the cumulative total of the last three weeks that they were net buyers (late Jan-mid-Feb). The Turkish lira has stabilized.  Consider that actual volatility (historic) over the past month is about 7.1%.  A month ago, it was around 13%. At the end of last year, it was almost 100%.   The Johnson government lost its junior Justice Minister Wolfson over the "repeated rule-breaking."   Meanwhile, reports suggest the prime minister will likely be fined a second time.  However, sterling is unperturbed by these developments.  It is extending yesterday's dramatic recovery. Sterling posted a key reversal yesterday by falling to new lows before rallying and settling above the previous day's high.  There has been follow-through buying that has lifted sterling to almost $1.3150 today.  Yesterday, it recorded a low near $1.2975.  The $1.3175-$1.3200 area may offer stronger resistance.  The euro is also extending its recovery.  Buying emerged yesterday ahead of $1.08.  It reached a three-day high slightly below $1.0925.  There is a 600-euro option at $1.0920 that expires today.  Nearby resistance is seen around $1.0950.   America US retail sales look to have strengthened, but the devil is in the details.   The median forecast (Bloomberg survey) sees retail sales rising 0.6% after a 0.3% gain in February.  However, high price gasoline can again skew the data. Recall that the CPI figures showed an 18% rise in gasoline prices last month (which accounted for more than half of the 1.2% monthly gain). What Bloomberg calls the control measure, which excludes food services, gasoline, autos, and building materials, is used by some economic models of GDP, which pick up those items through a different time series than the retail sales report.  After being crushed in February, falling 1.2%, the median in Bloomberg's survey calls for a 0.1% gain.  The risk is that rising gasoline prices slams discretionary purchases.  Separately, import and export prices are expected to have continued to accelerate last month.   Although export prices are rising faster than import prices, the US trade deficit has deteriorated. The US reports weekly jobless claims.  Revisions to the seasonal adjustment may be exaggerating the recent decline, but the labor market remains tight in any event.  Business inventories are expected to have risen in February (~1.3%) after a 1.1% gain in January.  While it would be strong, for GDP purposes the key is the change in the change, as it were.  In Q1 business inventories grew by an average of about 1.7% a month.  The slower inventory growth is part of the slowing we anticipate in Q1.  Lastly, the University of Michigan's consumer confidence measures is likely to have deteriorated, but it may be the inflation gauges that draw the most attention.  Many economists suspect US CPI, especially the core measure, may have peaked.   The Bank of Canada delivered the much anticipated 50 bp hike yesterday.   The market has fully priced in a 25 bp hike at the next meeting in early June.  The risk seems to be for another 50 bp hike. The central bank lifted the neutral rate to 2.50% from 2.25% and suggests that is where it was headed.  It lifted its inflation forecasts.  It now expects CPI to average 5.3% this year, up from the 4.2% forecast in January.  Next year's forecast was lifted to 2.8% from 2.3%.  Also, as anticipated, the Bank of Canada will stop recycling maturing proceeds and allow its balance sheet to shrink.  Over the next 12-months about a quarter of the bonds bought on net basis during the pandemic (C$350 bln) will roll-off.   The US dollar posted a key downside reversal against the Canadian dollar yesterday and follow-through selling has been seen.   Initially the greenback made new highs for the move to around CAD1.2675 yesterday before turning around and settled below the previous session's low (~CAD1.2580).  It has been sold to around CAD1.2540 today, which is the (50%) retracement of the greenback's rally off the April 4 low for the year near CAD1.2400.  The next retracement (61.8%) is closer to CAD1.2500.  The Mexican peso's run is getting stretched.  It managed to extend the most recent streak to its fifth consecutive advance yesterday, but the upticks are getting harder to secure. The peso is better offered today, with the dollar near MXN19.80.  Initial resistance may be in the MXN19.88-MXN19.92 area.       Disclaimer
FX: EUR/USD And GBP/USD - Powell And Lagarde May Affect These FX Pairs Today. How Is USD/JPY Doing?

DAX, EUR/GBP And EUR/USD Recovered Thanks To ECB Interest Rate Decision!? European Central Bank Makes European Indices Gain

Mikołaj Marcinowski Mikołaj Marcinowski 14.04.2022 16:23
It’s not easy time for Europe’s residents and European Central Bank’s decision makers. Ongoing war in the Ukraine with foreseen, intensified warfare and consequences of COVID-19 pandemic influenced economics of many countries. Naturally, the charts show that DAX and CAC40 trade higher than before the outbreak of the virus. To me, it only supports the thesis all mentioned events stopped European indices, companies and countries from growing much, much further. Emphatic European Central Bank (ECB) Let Economies Recover And Stay Strong? Since 2016 the ECB interest rate has amounted to 0%. Having in mind all the events which took place throughout last six years it seems to had been a correct decision. Coronavirus crisis influenced countries despite their economic status so tighter monetary policy would have weaken the euro and equities even further. But… Related article: ECB Interest Rate Decision Is Coming! European Indices (DAX, CAC40) To Plunge Or Rise? What About Forex Pairs? Inflation Is Taking Its Toll! Although the Russia-Ukraine warfare is still there and negotiations don’t seem to be working and stimulus for markets is highly demanded, the inflation is gaining momentum around the world. ECB is trapped in. These two contradictory factors may make decision makers confused, but let’s have a look how have markets reacted to today’s monetary policy statement of ECB. Forex: EUR/GBP Chart Shows Consequent Move Of The Price Strengthening of euro or weakening of British pound is driven by i.a. inflation data coming from the United Kingdom. The news coming from the UK in past months weren’t so optimistic as the inflation hit 30-year-high. EUR/GBP Chart Forex: EUR/USD influenced by both – ECB interest rate decision, war and Fed’s rhetoric As the week is coming to the end we see how many factors shaped the rates of certain currencies. This week’s inflation data of USA and the release of crude oil inventories make the asset quite volatile. Yeah… The right hand side… That’s a drop! EUR/USD Chart DAX Regained After Trading Lower Yesterday’s Morning Significant, ca. 2% decrease is almost compensated. DAX (GER40) Chart CAC40 Is Heading To A 1% Gain French index has been more aggressive until now. Today’s opening gain brought some optimism to investors. CAC40 Chart Source/Data: Investing.com, TradingView.com Charts: Courtesy Of TradingView.com
If You Consider Investing In Gold, Watch Today's Data Closely. Important Releases Today Are US ISM Manufacturing PMI, Eurozone Inflation And HICP

(USOIL) Crude Oil Price Crisis!? Fed To Boost (USD) US Dollar? UK Inflation Rate Surprised Many This Week, What About The Following One? Economic Calendar by FXMAG.COM

Mikołaj Marcinowski Mikołaj Marcinowski 16.04.2022 17:59
Today, tomorrow and on Monday many countries around the world celebrate Easter. Friday was a day free for many stock markets and banks too. As we wrote yesterday forex market was live so we may say it had some time to stock (sic!) up. The following week is going bring many news and next proves of hawkish rhetoric of Fed, ECB and BoE. Monday – Going East – Chinese GDP On Monday many, many countries – Germany, Italy Spain, Australia and more has a day free. Only in China, very early in the morning GDP and Industrial Production are printed. Previously Gross Domestic Product amounted to 4%. Another indicator released at 3 a.m. – Industrial Production hit 7.5% previously. Related article: Deutsche Bank Shook DAX! French Election, Inflation And ECB Are Factors Which Shaped DAX (GER 40), CAC40, FTSE 100 And IBEX35 - Top Gainers, Top Losers Tuesday – RBA Meeting Minutes – NZD/USD To Plunge Again!? It’s good to have a look at RBA Meeting Minutes in the morning. The document will be released at 2:30 a.m. and may let us prepare NZD rate prediction. At 1:30 p.m. we focus on the data coming from the USA. Building Permits release previously amounted to 1.865M. This indicator let us diagnose the real estate market in the United States. Wednesday - Crude Oil Price To Skyrocket!? CAD/USD And NZD/USD May Fluctuate! First release of the day is Chinese PBoC Loan Prime Rate which takes place at 2:15 a.m. Previously this indicator amounted to 3.7%. At 1:30 p.m. you better follow CAD/USD and other pairs with Canadian dollar as Core CPI may shake the rate. Indicator amounted to 0.8% previous time. Later in the afternoon investors should follow the release of Existing Home Sales (6.02M) and, what’s most important – Crude Oil Inventories. ON April 13th Crude Oil Inventories hit 9.382M! Very late in the afternoon we focus on New Zealand where CPI (Q1) is released. Let’s follow NZD forex pairs then. Thursday – Huge Gain Of US Dollar Index (DXY) Amid Hawkish Fed!? Follow Euro To US Dollar (EUR/USD) and GBP/USD Fluctuations! What Will BoE And ECB Do? Naturally next Fed decision is made in May, but before it happens we all stay updated with the current Fed rhetoric expressed by i.a. Jerome Powell who speaks at 6 p.m. on Thursday. What’s more it’s going to be a really, really market moving day as alongside Powell, BoE’s Bailey and ECB’s Lagarde speaks as well! Additionally, at 10 a.m. the EU CPI is released. After the recent interest rate decision ECB’s rhetoric is definitely worth a follow! Article on Crypto: Hot Topic - NEAR Protocol! Terra (LUNA) has been seeing a consistent downward price trend, DAI Should Stay Close To $1 Friday – GBP/USD To Plunge!? UK Manufacturing PMI Release And BoE’s Lagarde Speaks Again The following week ends with some important releases. We begin with UK Retail sales, Manufacturing PMI, Services PMI and German Manufacturing PMI. In the afternoon Canadian Core Retail Sales (2.5%) is released. The day ends with ECB’s and BoE’s representatives’ testimonies. Source/Data: Investing.com Economic Calendar
The sectors most affected by soaring energy prices | ING Economics

Euro To US Dollar (EUR To USD): That's An Amazing USD Performance, Will USDCAD (Canadian Dollar) Stay Close? USDJPY (Japanese Yen) Beats Records!

Jason Sen Jason Sen 20.04.2022 10:39
EURUSD retests 37 YEAR TREND LINE SUPPORT AT 1.0760/20. Longs need stops below 1.0670. Obviously there is nothing more important than this level this week. Longs at 1.0760/20 initially target 1.0820/50. Above here is more positive targeting 1.0900/20 then 1.0960/70. USDCAD strong resistance at 1.2650/70. Shorts need stops above 1.2690. A break higher is a medium term buy signal. Related article: Monetary Policy Drives EUR/USD, The Future of the EUR/GBP Awaits the Bank Of England's Speech - Good Morning Forex| FXMAG.COM Very minor support at 1.2610/1.2590 & again at 1.2525/05 today. If we continue lower look for 1.2480/70. We have another buying opportunity at 1.2440/10. Longs need stops below 1.2370. A break lower is an important medium term sell signal. USDJPY beat 14 year trend line resistance at 127.10/50 & rocketed another 200 pips!! The pair has 13 blue bodied daily & 7 weekly candles in a row. So sell signal yet despite severely overbought conditions. Above 129.50 look for 129.90/95 then 130.25/35, perhaps as far as 130.75/85. First support at 128.45/25. Further losses can target 127.80/70. Unlikely but if we continue lower look for strong support at 127.10/126.90. Read next: Gold Price Falls, Volatility in Wheat Futures and The Price Of Palladium| FXMAG.COM EURJPY higher as expected reaching 139.67 & no sell signal yet as we become overbought. Further gains can target 139.95/99 then 140.40/50 & 140.85/95. GBP To USD GBPUSD retests last week's low at 1.2990/70 after the bullish engulfing candle so now we just have to see if we get a double bottom buy signal or if the pair break lower for a sell signal. So far the bulls are winning as we bounce from 1.2977. A break below 1.2955 should be a medium term sell signal. Our longs target 1.3060/70 & 1.3100/10, perhaps as far as first resistance at 1.3150/70. Please email me if you need this report updated or Whatsapp: +66971910019 – To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk
Markets find balance ahead of fresh economic data and speeches from Lagarde and Powell (expect a local increase in EUR/USD and a decease in USD/CAD)  | InstaForex

Monetary Policy Drives EUR/USD, The Future of the EUR/GBP Awaits the Bank Of England's Speech - Good Morning Forex

Rebecca Duthie Rebecca Duthie 20.04.2022 10:17
Summary: EUR/USD and Monetary Policy. Bank Of England's Speech on Thursday effect on the GBP related currency pairs. AUD/CHF as a reflection of investor risk sentiment. Related article: Japanese Yen (JPY) Weakens Against The Dollar, USD/CAD Stable And The Inevitable Strengthening Of The USD, IMF/World Bank Events Monetary Policy driving the EUR/USD price action. Since the market opened this morning, the EUR has strengthened against the USD and the market sentiment is bullish, the rise in price is small but significant given the current economic conditions. With the differing monetary policy of the European Central Bank (ECB) and the US Federal Reserve (Fed) the EUR/USD currency pair price is low. In the coming weeks it is likely to see the dollar strengthening thanks to the expectations of the Fed to tighten monetary policy. Whereas, there is no certainty on when the ECB will begin rising interest rates. EUR/USD Price Chart Value of the GBP Awaits BOEs Speech Since the market opened this morning the price of the currency pair has increased, however, market sentiment for the EUR/GBP has changed from bullish yesterday to a mixed today. The strengthening EUR against GBP comes in light of the Bank of Englands (BOE) announcements tomorrow regarding the future monetary policy of the country, investors are expecting more hawkish actions. EUR/GBP Price Chart  Read next: Altcoins' Rally: Solana (SOL) Soars Even More, DOT and SHIBA INU Do The Same! | FXMAG.COM AUD/CHF Since the market opened this morning, the value of the AUD/CHF has increased, and has a bullish market sentiment. This currency pair can be used as a good reflection of risk sentiment, this is because the AUD is risk-on and the Swiss Franc is considered as a safe-haven currency. AUD/CHF Price Chart GBP loses some ground on the JPY The price of the GBP/JPY currency pair has (in general) been on the rise as a result of the rapidly depreciating value of the Yen. However, since the market opened this morning the price has decreased despite the bullish market sentiment, possibly due to the uncertainty regarding the future of the GBP and the upcoming BOE’s announcements. GBP/JPY Price Chart Sources: Finance.yahoo.com, teletrade.eu, dailyfx.com
USD/CNY and USD/CNH analysis. Russia’s inflation has been accelerating sharply since the invasion of Ukraine

USD/CNY and USD/CNH analysis. Russia’s inflation has been accelerating sharply since the invasion of Ukraine

Ed Moya Ed Moya 09.05.2022 06:53
The focus for the upcoming week will naturally be a wrath of Fed speak and the latest US CPI data which is expected to show inflation decelerated sharply last month. A sharper decline with prices could vindicate Fed Chair Powell’s decision to remove a 75 basis-point rate increase at the next couple policy meetings.   Russia Russia’s inflation has been accelerating sharply since the invasion of Ukraine. In March, CPI rose to 16.7% (YoY) and is expected to climb to 18.1% in April. The driver behind the sharp upswing has been Western sanctions, which have reduced the availability of consumer imports and key components for domestic products. CPI is expected to continue to climb in the coming months.   China China releases its Balance of Trade on Monday and Inflation on Tuesday. Both have downside risks given the disruption to business and the collapse in property sales and sentiment due to the covid-zero policy. Restrictions continue tightening in Beijing and the covid-zero policy has become the biggest headwind to a China recovery. The government reaffirmed its commitment to the policy Friday, sending China stocks lower. Additionally, US-listed China stocks face new delisting risk from US regulators that is weighing on Hong Kong markets especially, where most dual listings live. Negative headlines around Covid 19 or US delisting over the weekend could send China equities sharply lower into the start of the week. USD/CNY and USD/CNH have now risen from  6.4000 to 6.7000 in just two weeks. The PBOC remains comfortable at this stage, being a back door stimulus to manufacturers. The PBOC USD/CNY fixing will be the key indicator as to whether the authorities have said Yuan depreciation has gone far enough.
Week Ahead – Volatile Markets

The Consequences Of FOMC (USD Index), US CPI Release And European Sentiment | Oanda: "Week Ahead – Volatile Markets"

Ed Moya Ed Moya 09.05.2022 06:48
Every asset class has been on a rollercoaster ride as investors are watching central bankers all around globe tighten monetary policy to fight inflation.  Financial conditions are starting to tighten and the risks of slower growth are accelerating.   The focus for the upcoming week will naturally be a wrath of Fed speak and the latest US CPI data which is expected to show inflation decelerated sharply last month. A sharper decline with prices could vindicate Fed Chair Powell’s decision to remove a 75 basis-point rate increase at the next couple policy meetings. A close eye will also stay on energy markets which has shown traders remain convinced that the market will remain tight given OPEC+ will stick to their gradual output increase strategy and as US production struggles to ramp up despite rising rig counts.  Energy traders will continue to watch for developments with the EU nearing a Russian energy ban.   US Market volatility following the FOMC decision won’t ease up anytime soon as traders will look to the next inflation report to see if policymakers made a mistake in removing even more aggressive rate hikes off the table over the next couple of meetings.  The April CPI report is expected to show further signs that peak inflation is in place.  The month-over-month reading is expected to decline from 1.2% to 0.2%, while the year-over-year data is forecasted to decrease from 8.5% to 8.1%. The producer prices report comes out the next day and is also expected to show pricing pressure are moderating.  On Friday, the University of Michigan Consumer Sentiment report for the month of May should show continued weakness. The upcoming week is filled with Fed speak that could show a divide from where Fed Chair Powell stands with tightening at the June and July meetings.  On Tuesday, Fed’s Williams, Barkin, Waller, Kashkari, Mester, and Bostic speak.  Wednesday will have another appearance by Bostic. Thursday contains a speech from the Fed’s Daly.  On Friday, Fed’s Kashkari and Mester speak.   EU The Russia/Ukraine war and the sanctions against Russia have dampened economic activity in the eurozone. Germany, the largest economy in the bloc has been posting weak numbers as the war goes on. With the EU announcing it will end Russian energy imports by the end of the year, there are concerns that the German economy could tip into a recession. On Tuesday Germany releases ZEW Survey Expectations, which surveys financial professionals. Economic Sentiment is expected to decline to -42.5 in May, down from -41.0 in April. On Friday, the Eurozone releases Industrial Production for March. The Ukraine conflict has exacerbated supply line disruptions, which is weighing on industrial production. The sharp drop in German Industrial Production (-3.9%), suggests that the Eurozone release will also show a contraction. The March estimate is -1.8%, following a gain of 0.7% in February. 
Record-breaking but near-peak inflation in Britain

Record-breaking but near-peak inflation in Britain

Alex Kuptsikevich Alex Kuptsikevich 19.05.2022 08:40
UK consumer prices rose by 2.5% in April, the second-biggest monthly gain in the indicator’s history since 1988. Annual inflation jumped from 7% to 9%, unseen in the indicator’s history. Metals, meanwhile, have withdrawn from the highs The longer-established retail price index last saw a high annual growth rate (11.1% y/y in April) in 1982, while such a big monthly jump (3.4% m/m) was last observed in 1980. However, despite the horror that these figures represent, there are still indications that the UK’s peak annual rate of inflation will be much lower than in the 1980s (22%) or 1970s (27%). While Output Producer Prices are showing an acceleration in the annual growth rate, rising to 14%, Input PPI has slowed from 19.2% to 18.6%. Although remaining volatile in recent weeks, oil and gas have regularly retreated from highs, limiting upward pressure on prices. Metals, meanwhile, have withdrawn from the highs. Read next: Altcoins: What Is Monero? Explaining XMR. Untraceable Cryptocurrency!? | FXMAG.COM Early hints that UK inflation may be slowing in the coming months may allow the Bank of England to raise the rate by 25 points At the same time, there are growing questions about final global demand, which will constrain producers in shifting costs to consumers. Early hints that UK inflation may be slowing in the coming months may allow the Bank of England to raise the rate by 25 points at its next meeting in mid-June and not copy the Fed’s 50-point move. This is moderately negative news for the British currency, which started to retreat from the $1.25 area on the data after a 2.9% rally from last Friday’s lows. Short-term traders should pay particular attention to the 1.2350 area. Read next: Altcoins: What Is Litecoin (LTC)? A Deeper Look Into The Litecoin Platform| FXMAG.COM Already, a dip lower this week would suggest that the brief period of recharging dollar bulls has ended. In this case, GBPUSD could quickly fall below 1.2000, making the 1.1500 area a potential ultimate target for this attack Follow FXMAG.COM on Google News
Ending a bad month in the red

What's The Future Of British Pound (GBP)? Stocks: Snap Has Fallen! How Far Will New Zealand Dollar Go!? | Least worst choices | Oanda

Jeffrey Halley Jeffrey Halley 25.05.2022 11:05
RBNZ hikes by 50-bps The Reserve Bank of New Zealand has raised policy rates by 0.50% to 2.0% this morning, with Governor Orr setting a hawkish tone in the press conference afterwards. In the statement itself, the RBNZ’s “least worst choices” policy seemed to imply that although external risks remained, the domestic economy was strong and could tolerate tighter monetary conditions. Mr Orr seemed to be saying much the same, suggesting that terminal rates could go above 3.0% and would get there sooner, rather than later. We’ll see just how strong the New Zealand economy is in due course, but a hawkish RBNZ has seen the New Zealand dollar rally by 0.70% to 0.6505 today, making it the biggest currency gainer in Asia today. Elsewhere, Singapore’s GDP growth came in tight on expectations, rising by 3.70% YoY for Q1. With inflation data yesterday also less worse than expected, expectations for another unscheduled tightening by the Monetary Authority of Singapore have receded for now. That may bring some relief to the Malaysian ringgit, which has fallen to 3.20 against the Singapore dollar. Snap Has Fallen In Malaysia itself, Inflation data for April continues to remain benign as domestic demand stays subdued. Inflation YoY rose by just 2.30% and will leave Bank Negara, like Bank Indonesia yesterday, in no hurry to tighten monetary policy. Ominously though, the Malaysian ringgit has shown no strength versus the US dollar. USD/MYR remains at recent highs at 4.4000 even as the greenback is experiencing an extended bull market correction versus the G-10 and EMFX elsewhere. If the US dollar turns higher once again, and the MYR resumes its sell-off, Bank Negara’s hand might be forced. Overnight, the recession word weighed on stock markets once again. European PMI data was a mixed bag. Manufacturing PMIs held steady, while Services PMIs fell as consumer demand takes a hit from the rise in the cost of living. That wasn’t enough to stop the euro rally, powered by suddenly hawkish ECB heavyweights. Bank of England, has already signalled a white flag on bringing down inflation The picture was rather grimmer in the United Kingdom where the most honest central bank in the world, the Bank of England, has already signalled a white flag on bringing down inflation and pencilled in a recession next year. UK Manufacturing PMI held steady at 54.6, but Services PMIs plummeted to 51.8. The UK is facing a winter of discontent as the cost of living soars, with the railways RMT union voting to strike over pay negotiations. Expect more of this going forward. Additionally, the Chancellor is apparently preparing to widen the scope of the windfall tax on energy companies, probably to help pay for his cost of living mini-budget. UK stock markets didn’t like that. Finally, the “party gate” report on those lockdown wine frenzies in the No 10 garden is due for release today, potentially putting more pressure on PM Johnson’s leadership. ​ Little surprise that the sterling slumped versus the euro and the US dollar overnight. In the United States, the recession world hit particularly hard after the Snap Inc. induced meltdown by Nasdaq stocks overnight. US New Home Sales plummeted to 591,000 in April, while Richmond Fed Manufacturing slumped to -9 in May. The S&P Global Services Flash PMI for May fell to 53.5, with Flash Manufacturing easing to 57.5. It was the new home sales that really frightened the street, though, as house building, and its ancillary services and suppliers are a good chunk of US domestic GDP. Soaring mortgage interest rates and petrol prices appear to be doing a lot of the Fed’s work for it before it even gets started. Read next: (TRX) TRON USD Decentralised Blockchain Platform That Focuses On Entertainment And Content Sharing. Altcoins: A Deep Look Into The TRON Network | FXMAG.COM If there is one takeout from all of this for me, it is that rising inflation and borrowing rates are already crimping the demand side of the equation. Unfortunately, we are seeing very little sign of price pressures reducing due to a combination of factors, all of which have been thrashed to death here and in research everywhere. The uncomfortable reality is that central banks are going to be forced to continue the tightening path, even as growth slows around the world, because inflation has proven sticky and not transitory. That is the least worst choice central banks need to make in a stagflationary environment. I am asked every day if we have seen the low in the equity market sell-off. Hopefully, I have answered the question. US President Joe Biden’s trip around Asia continues Finally, US President Joe Biden’s trip around Asia continues. Unfortunately, with its emphasis on containing China and hawking a trade agreement empty of potential access to the US domestic market (Congress needs to approve that), the trip is not going to make much headway in re-establishing US leadership in the region. Asia really needs to see the colour of America’s money. Furthermore, the reliability of the US as a partner has taken a further hit today, with White House officials explicitly refusing to rule out the possibility that the US could enact crude oil export restrictions to help cap energy prices domestically. The US doesn’t have a crude oil problem, it has a refining and transportation problem, but let’s not let facts get in the way. I have warned about food nationalism previously, but if President Biden prioritises November’s mid-term elections over the economic war with Russia, and supporting Europe, it really is every man for himself globally. I can’t see that being positive for equities anywhere, or European asset markets full stop, or for Ukraine. Only the Kremlin is likely to be popping champagne as the US does Russia’s divide and conquer for them. This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds. Follow FXMAG.COM on Google News
Fed And US Dollar (USD) Are All About Mixed Feelings, Christine Lagarde And ECB In General May Support Euro Even In July. BoE's Bailey Also Teases A Rate Hike. XAU, XAG And Crude Oil Went Higher As USD Weakened | OneRoyal

Fed And US Dollar (USD) Are All About Mixed Feelings, Christine Lagarde And ECB In General May Support Euro Even In July. BoE's Bailey Also Teases A Rate Hike. XAU, XAG And Crude Oil Went Higher As USD Weakened | OneRoyal

OneRoyal Market Updates OneRoyal Market Updates 30.05.2022 10:14
Weekly Recap It was another bearish week for the US Dollar as the greenback continued to sell off from YTD highs. The FOMC meeting minutes, released mid-week, did little to inspire a fresh rally in the Dollar. While the minutes confirmed the Fed’s hawkish stance and reinforced expectations for further 50bps hikes in June and July, there was little in the way of exciting details to get bulls reinvigorated. Additionally, with the Fed having seemingly turned more hawkish since that meeting, the minutes felt a little outdated. Christine Lagarde, ECB And Rate Hikes On the data front, a string of weaker-than-expected indicators out of the eurozone heightened growth concerns. With ECB’s Lagarde essentially confirming a July rate-hike, recession fears weighed on European asset markets though EUR itself remained well bid. Elsewhere, equities markets generally saw a choppy week though most indices ended the week in the green, benefitting from the weaker US Dollar. Read next: Altcoins: What Is Polkadot (DOT)? Cross-Chain Transfers Of Any Type Of Asset Or Data. A Deeper Look Into Polkadot Protocol | FXMAG.COM BOE’s Bailey warned that further rate hikes will likely be necessary in the face of rising inflation. The new fiscal package announced by the UK government this week, aimed at helping households fight rising energy bills, has further increased the likelihood of BOE rate hikes in the near-term. Weaker Dollar, Stronger Crude, Gold And Silver Commodities prices were higher over the week also. Gold, silver and oil all rallied on the back of a weaker US Dollar. With monetary policy divergence between the Fed and other central banks drying up, USD pressure has helped commodities stay afloat recently. Coming Up This Week Australian GDP Australian GDP will be closely watched this week on the back of the recent RBA rate hike. With the bank lifting rates and sounding firmly hawkish in its outlook and assessment, this week’s data might further support growing RBA rate hike expectations. With the country having emerged from one of the longest lockdowns of the pandemic, the economy has been on the bounce-back. However, as we have seen elsewhere, the economy has still been rocked by rising inflation and supply constraints. Traders will be keen to see the extent to which these factors weighed on the economy over the last quarter. BOC Rate Decision The BOC is widely expected to raise rates when it convenes for this month’s meeting mid-week. All 30 economists polled by Reuters ahead of the event are looking for a .5% hike. With this in mind, the focus will be on the bank’s forward guidance. If the BOC gives a clear signal that further hikes are coming in the near future, this should drive CAD higher near-term. However, if there is any indication that the BOC might look to hold off on any further rate hikes near-term, this will likely see cad dragged lower. Read next: Altcoins: Cardano (ADA) What Is It? - A Deeper Look Into Cardano (ADA) | FXMAG.COM US Non-Farm Payrolls The latest set of US labour market indicators this week will be closely watched as we head to the June meeting. Recent Fed commentary has been decidedly hawkish and it would likely take a major downside shock to change this narrative. Even then, it certainly wouldn’t impact the June rate hike and would likely only factor in forward guidance issued by the Fed. Still, with slowdown fears building, any weakness would no doubt act as a headwind to risk sentiment in the short-term. Forex Heat Map Technical Analysis Our favourite chart this week is the Dollar Index (DXY) The DYX has pulled back from recent multi-year highs and is now sitting on a make-or-break level at 101.94. This level was the 2020 closing high price. While the level holds as support, DXY is likely to recover and continue the longer-term bull trend. Below here, however, there is room for the correction to develop further towards next support at 100.37 Economic Calendar Plenty of key data releases to keep an eye on this week including Australian GDP, BOC rate decision and US Non-Farm Payrolls to name a few. Please see full calendar below for the complete schedule . Follow FXMAG.COM on Google News