23.01.23 - 27.01.22
Results of the previous week
| JWN +40.21% | NQ +4.89% | COFFEE +1.78% |
NG -7.79% | XAGUSD -4.46% | GBPUSD -2.31% |
Corporate earnings season continues, and companies are showing decent results. In addition, last week, the US Federal Reserve hiked its key interest rate by 0.25%, while at the accompanying press conference, it was announced that future decisions will be taken based on incoming macroeconomic data. The market perceived this as a shift to a more dovish position in the US regulator's approach to monetary policy, which provided indices with moderate support.
The British economy's murky prospects put pressure on the pound, which suffered losses against the dollar. That occurred even despite the fact that the Bank of England raised its interest rate by 0.5%, in line with forecasts. The European Central Bank followed suit with its interest rate, as well. Regulators are taking measures to restrain price pressures that remain extremely high.
Brent oil prices returned to around $82 a barrel. Traders are evaluating how demand for the energy resource will play out. On the one hand, they expect demand to rise in China, which has removed most of its anti-COVID restrictions and is rebuilding business activity. On the other, the prospects for the entire global economy amidst interest rate hikes by central banks are causing serious concerns, which could negatively impact oil consumption.
Key events of the current week
The US. EIA crude oil reserves data | DATE 08.02 | GMT | FORECAST | PREV. | IMPORTANCE |
Oil prices remain under pressure. Key factors impacting them are supply and demand dynamics, as well as expectations that the market will be balanced. Less-than-positive expectations about the demand for the energy resource are determining current price movements. Furthermore, the latest data on US oil reserves reflect an increase, which also serves as proof of demand not being very high. If the upcoming US crude oil reserves report shows that this movement is continuing, pressure on oil prices could strengthen. In such a scenario, we could see Brent (BRN) continue to move toward $77,60 per barrel. | |||||
The UK. GDP growth rates | DATE 10.02 | GMT | FORECAST | PREV. | IMPORTANCE |
Rising energy prices and price pressure are negatively affecting most of Europe's largest economies. What's more, all analysts agree that the British economy will show some of the weakest growth rate numbers. This is due to the country continuing to be affected by processes set off by Brexit. The UK economy is expected to show slightly weaker results compared to the same period last year. In this case, the British pound won't find support even from the Bank of England's 2 February decision to once again raise its rate, this time to 4%. If the report is in line with forecasts, the GBP/USD pair may continue to decline to 1,1880. | |||||
The US. University of Michigan Consumer Sentiment Index | DATE 10.02 | GMT | FORECAST | PREV. | IMPORTANCE |
For the service-oriented US economy, consumer sentiment is a very important indicator since it allows us to understand how Americans assess their own prospects. The US labour market is looking fairly optimistic for the most part. Furthermore, a gradual decrease in price pressure can be seen. This is reflected by the fact that consumer sentiment has been rising over the past three months, often exceeding forecasts. The indicator is also expected to have improved during the reporting period. Such a result is not unexpected, especially when considering that the US Federal Reserve is showing a more dovish attitude towards monetary policy than before. As such, if this indicator is in line with forecasts, the dollar could find short-term support. In such a scenario, EUR/USD could drop to around 1.0690. | |||||
