Europe Roundup: Sterling edges up against dollar after UK jobs data, European shares dips, Gold retreats, Oil prices hit two-week highs on hopes of China demand rebound-January 17th,2023

Posted at 17 January 2023 / Categories Market Roundups

Market Roundup

•UK Dec Claimant Count Change 19.7K,19.8K forecast,30.5K previous

•UK Nov  Average Earnings ex Bonus  6.4%, 6.3% forecast,6.1% previous

•UK Nov  Average Earnings Index +Bonus  6.4%,  6.2% forecast,6.1% previous

•UK Nov  Unemployment Rate  3.7%,3.7% forecast,3.7% previous

•UK Nov  Employment Change 3M/3M (MoM)27K,5K forecast,27K previous

•German Dec HICP (MoM)  -1.2%,-1.2%  forecast,0.0% previous

•German Dec CPI (MoM) -0.8%, -0.8%  forecast,-0.5% previous

•German Dec HICP (YoY) 9.6%,  9.6% forecast,11.3% previous

• Italian Dec HICP (YoY)  12.3%,12.3% forecast,12.6% previous

•Italian Dec CPI Ex Tobacco (MoM)  11.3%,11.5% previous

•Italian Dec CPI (YoY)  11.6%,11.6% forecast,11.8% previous

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

•German Jan ZEW Economic Sentiment  16.9,-15.0 forecast,-23.3 previous

•German Jan ZEW Current Conditions  -58.6, -58.3 forecast,-61.4 previous

•German Jan ZEW Current Conditions  -58.6,-58.0 forecast, -61.4 previous

Looking Ahead Economic Data(GMT)

•13:15   Canada Dec  Housing Starts   257.5K forecast, 264.2K previous

•13:30 US Jan  NY Jan  Empire State Manufacturing Index -8.70 forecast,  -11.20 previous

•13:30 Canada Common CPI (YoY) 6.6% forecast, 6.7% previous

•13:30   Canada Trimmed CPI (YoY) 5.3% previous

•13:30 Canada Median CPI (YoY) 5.0% previous

•13:30 Canada Nov Foreign Securities Purchases by Canadians -1.67B previous

•13:30   Canada Dec Core CPI (YoY)  5.8% previous

•13:30 Canada CPI (MoM) -0.5% forecast, 0.1% previous

•13:30 Canada Nov Foreign Securities Purchases 8.46B previous

•15:00 New Zealand  Global Dairy Trade Price Index-2.8% previous

•16:30 US 3-Month Bill Auction 4.5 60% previous

•16:30 US 6-Month Bill Auction 4.710% previous

Looking Ahead - Economic events and other releases (GMT)

•No significant events


 EUR/USD: The euro strengthened against dollar   on Tuesday  as single currency was  buoyed after German investor sentiment came in positive territory in January for the first time since the Ukraine war began as signs point to a milder recession over the winter months than initially feared, the ZEW economic research institute said on Tuesday.The institute's economic sentiment index rose to 16.9 from minus 23.3 in December, beating expectations by analysts polled of a reading of minus 15.0.Immediate resistance can be seen at 1.0896(23.6%fib), an upside break can trigger rise towards 1.0950 (Higher BB).On the downside, immediate support is seen at 1.0778(5DMA), a break below could take the pair towards  1.0693(38.2%fib).

GBP/USD: The British pound edged higher on Tuesday after data showed a tight labour market and accelerating pay growth, adding to the Bank of England’s inflation worries as it tries to bring prices down from multi-decade highs. The BoE is expected to raise rates for the tenth consecutive meeting when it meets on Feb. 2 as it attempts to further bring down inflation from the more-than-four-decade high of 11.1% reached in October last year.Money markets are fully pricing in a 25 basis points (bps)rate hike at that meeting, with a roughly 75% chance of a larger 50 bps increase .By 1025 GMT, the pound was up 0.1% against the dollar to $1.2211. Immediate resistance can be seen at 1.2276(Daily high), an upside break can trigger rise towards 1.2417(23.6%fib).On the downside, immediate support is seen at 1.2175 (5DMA), a break below could take the pair towards 1.2026(38.2%fib).

USD/CHF: The dollar declined against the Swiss franc on Tuesday as   sought direction from the U.S. Federal Reserve's rate hike path. Markets are mostly pricing in a smaller 25-basis-point increase when the Fed announces its policy decision in February. The U.S. central bank slowed its pace of hikes to 50 bps in December after four consecutive 75 bps increases.   China’s economic growth in 2022 slumped to one of its worst in nearly half a century as the fourth quarter was hit hard by stringent COVID-19 curbs and a property market slump. Immediate resistance can be seen at 0.9267 (9DMA), an upside break can trigger rise towards 0.9327 (38.2%fib).On the downside, immediate support is seen at 0.9203  (23.6%fib), a break below could take the pair towards 0.9168 (Lower BB).

USD/JPY: The dollar edged higher Tuesday as  Japanese yen fell ahead of the result of the BOJ meeting.The dollar index bounced from a seven-month low of 101.77 made a day ago, holding at 102.30, while the Japanese yen stayed close to seven-month highs as investors held their breath for a potential policy shift at the Bank of Japan (BOJ).The yen steadied dipped to trade around 128.72 on Tuesday after hitting a top of 127.22 per dollar on Monday, with traders braced for sharp moves when the Bank of Japan (BOJ) concludes a two-day meeting on Wednesday.  Strong resistance can be seen at 130.25 (5DMA), an upside break can trigger rise towards 130.50 (38.2% fib).On the downside, immediate support is seen at 127.50 (23.6% fib), a break below could take the pair towards 127.11 (Lower BB).

Equities Recap

European shares slipped on Tuesday, taking a breather from their sharp rally since the start of this year, after China posted its weakest annual economic growth in nearly half a century, stoking investors' fears of an economic slowdown.

At (GMT 12:41 ),UK's benchmark FTSE 100 was last trading down at 0.21 percent, Germany's Dax was down  by 0.12 percent, France’s CAC   was down  by 0.07 percent.

Commodities Recap

Gold prices fell on Tuesday as the dollar ticked up, while investors still sought direction from the U.S. Federal Reserve's rate hike path.

Spot gold fell 0.6% to $1,906.49 per ounce by 1117 GMT. The metal closed lower on Monday, after having risen to its highest since April 2022.U.S. gold futures dropped 0.6% to $1,909.30.

Oil prices rose to their highest in two weeks on Tuesday after China posted weak but expectation-beating annual economic growth data and on hopes that a recent shift in its COVID-19 policy will boost fuel demand.

Brent crude futures rose $1.14, or 1.4%, to $85.60 a barrel by 1224 GMT.

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