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Europe Roundup: Euro hits two-month low as hawkish Fed fuels dollar , European shares slip, Gold slips to hit one-month low, Oil prices retreat, but stay near multi-year highs –June 17th,2021

Posted at 17 June 2021 / Categories Market Roundups


Market Roundup

•German May Car Registration (MoM)  0.4%, -21.4% previous

•German May Car Registration (YoY)   37.2%,90.0% previous      

• French May Car Registration (MoM) 0.4%, -23.2% previous     

• French May Car Registration (YoY)  46.4%,568.8% previous

•UK May Car Registration (MoM)  10.7%,-50.1% previous

•Italian May Car Registration (MoM) -1.6%, -14.5% previous

•Switzerland SNB Interest Rate Decision -0.75%,-0.75% previous

•Italian Apr Trade Balance 5.870B, 5.190B previous

•EU May Core CPI (MoM)  0.2%,               0.2%forecast, 0.5% previous

•EU May CPI (YoY)  2.0%, 2.0% forecast, 1.6% previous

•EU May CPI (MoM)  0.3%,0.3% forecast, 0.6% previous

•EU May Core CPI (YoY)  1.0%,0.9% forecast, 0.9% previous

Looking Ahead - Economic Data (GMT)

•12:30 Canada Apr Foreign Securities Purchases by Canadians  21.22B previous

•12:30 Canada Apr Foreign Securities Purchases  3.25B previous

•12:30 US June Philly Fed Business Conditions  52.7 previous

•12:30 US June Philly Fed New Orders   32.5 previous

•12:30 US June Philadelphia Fed Manufacturing Index  31.0forecast, 31.5 previous

•12:30 US June Philly Fed Prices Paid  76.80 previous

•12:30 US June Philly Fed Employment  19.3 previous

•12:30 US June Philly Fed CAPEX Index  37.40 previous

•12:30 Canada ADP Nonfarm Employment Change 351.3K previous

•12:30 US Initial Jobless Claims 359K forecast, 376K previous

•12:30 US Continuing Jobless Claims 3,430K forecast, 3,499K previous

•12:30 US Jobless Claims 4-Week Avg  402.50K previous

•18:30 Russia Central Bank reserves (USD) 605.2B previous

•19:30 US May Leading Index (MoM)  1.3%forecast, 1.6% previous

•20:00 US Natural Gas Storage 72B, 98B previous

Looking Ahead - Economic events and other releases (GMT)

•12:30 EU ECB’s Lane Speaks

•19:30 US Fed Chair Yellen Testifies

•19:30 ECB's Elderson Speaks

Fxbeat

EUR/USD: The euro declined to hit two-month low on Thursday as dollar continued to advance , hitting its highest level in more than two months after the Federal Reserve surprised markets by signaling that it would hike rates and stop buying bonds sooner than expected. After posting its biggest daily gain since March 2020 on Wednesday, the dollar held steady during Thursday's Asian session and then added gains as European markets opened. The euro dropped versus the dollar, with euro-dollar changing hands at a two-month low of $1.19295. Immediate resistance can be seen at 1.1992(200DMA), an upside break can trigger rise towards 1.2051 (50%fib).On the downside, immediate support is seen at 1.1925 (Daily low), a break below could take the pair towards 1.1845 (23.6% fib).

GBP/USD: The pound fell below $1.40 against the U.S. dollar on Thursday as the market reacted to an unexpectedly aggressive move by the Federal Reserve, which boosted the U.S. dollar against other major currencies. Federal Reserve officials said on Wednesday that they will raise interest rates early and stop buying emergency bonds. This led to a rise in US Treasuries and a fall in the equities. The pound was down 0.17% against the dollar, at $1.3955 at 11:40 GMT.Immediate resistance can be seen at 1.3983 (50% fib), an upside break can trigger rise towards 1.4035 (61.8%fib).On the downside, immediate support is seen at 1.3932 (38.2%fib), a break below could take the pair towards 1.3868 (23.6%fib).

USD/CHF: The dollar rose against the Swiss franc on Thursday after the U.S. Federal Reserve unexpectedly brought forward its projections for interest-rate hikes into 2023. On Wednesday, the Fed began to shut down monetary policy driven by the pandemic as officials set a dynamic interest rate hike schedule, began negotiations to end bond purchases during the crisis, and stated that the 15-month health  emergency was no longer major obstacle to U.S. commerce. Immediate resistance can be seen at 0.9160 (Daily high), an upside break can trigger rise towards 0.9188 (23.6% fib).On the downside, immediate support is seen at 0.9130  (38.2%fib), a break below could take the pair towards 0.9088 (50%fib).

USD/JPY: The dollar rose sharply against the yen on Thursday after U.S. central bank surprised investors by signalling it would raise interest rates at quicker pace than assumed, sending dollar sharply higher. The Fed's projections showed that 13 of the 18 members of the Monetary Policy Committee saw interest rates rise in 2023, compared to just six before, while seven tipped a first move in 2022. The Fed also pointed out that it will now consider cutting its $120 billion monthly asset purchase plan through meetings and reduce the risk of a pandemic as vaccines progress. Strong resistance can be seen at 110.82 (Daily high), an upside break can trigger rise towards 111.07 (April 6th high).On the downside, immediate support is seen at 110.48(38.2%fib), a break below could take the pair towards 110.01 (38.2% fib).

Equities Recap

European shares fell from record highs on Thursday, tracking declines on Wall Street after the Federal Reserve surprised investors by taking a hawkish tone to its policy, while CureVac sank 40% after failing in a pivotal COVID-19 vaccine trial.

At (GMT 11:20 ),UK's benchmark FTSE 100 was last trading down at 0.40 percent, Germany's Dax was up  by 0.06 percent, France’s CAC finished was up by 0.06 percent.

Commodities Recap

Gold fell to its lowest in more than a month on Thursday, pressured by gains in the dollar and U.S. Treasury yields after the Federal Reserve signalled earlier-than-expected interest rate increases.

Spot gold fell 0.4% to $1,804.40 per ounce by 0904 GMT, having touched its lowest since May 6 at $1,799.70.U.S. gold futures were down 3.1% to $1,804.20.

Crude oil prices dipped on Thursday as a stronger U.S. dollar brought them off multi-year highs, but losses were limited by a big drop in U.S. crude oil inventories.

Brent crude oil futures dropped 33 cents, or 0.4%, to $74.06 a barrel by 0836 GMT. They hit their highest since April 2019 in the previous session.


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