15.01.24 - 19.01.24
Results of the previous week
| VIX+7.88% | COCOA +6.65% | NQ+3.36% |
NG -23.86% | XAGUSD -4.74% | NZDUSD -1.38% |
Last week, US indices showed mixed dynamics. They received support from fairly positive macroeconomic data. But at the same time, the factor restraining growth is comments from the US Fed indicating that it's not going to take any hasty measures and, if necessary, won't lower its key rate. Only Nasdaq confidently set a historical high amid positive movement among high-tech sector stocks.
The dollar was predominantly strengthening against its main opponents on the forex market. The reason is still the same: the probability of a delay in the rate cut by the Federal Reserve. Commodity currencies were under additional pressure amidst news of insufficiently strong macrostatistics from China. Q4 results showed that the Chinese economy grew by 5.2%, which was below what most global analysts had expected.
Brent oil prices continue to attempt to gain a foothold above $80 a barrel. The energy resource is moderately supported by optimistic demand forecasts and production disruptions in the US (severe cold weather led to a 40% production cut in North Dakota). The conflict in the Middle East is also buoying prices.
Key events of the current week
The UK. Manufacturing PMI | DATE 24.01 | GMT | FORECAST | PREV. | IMPORTANCE |
The British economy suffered from rising energy prices and changing supply chains. The country's industrial PMI has been in decline since September 2022, And there are no signs of it moving to growth territory. That said, global analysts expect the index to gain slightly but still remain under the 50 mark. This is positive for the British pound, especially amidst the latest rhetoric from the US Federal Reserve that it has no intention of rushing to cut its key rate. In such a scenario, we could see the cable attempt to get back up to somewhere around 1.2770. | |||||
ECB rates decision | DATE 25.01 | GMT | FORECAST | PREV. | IMPORTANCE |
After eight months of decline, inflation in the eurozone has increased once again. The latest data indicate that inflation has hit 2.9%. Rising price pressure leaves the European regulator with no choice but to leave its key rate at the current 4.5%. This is what leading analytical agencies are forecasting. A rate this high doesn't favour economic growth, but more attention is being paid to comments made by representatives of central banks. Given accelerating inflation, the ECB won't change its stance on monetary policy. That's good news for the euro. In such a scenario, we could see the Fibre shortly return to 1.1000. | |||||
The US. GDP growth rate | DATE 25.01 | GMT | FORECAST | PREV. | IMPORTANCE |
The US economy is showing remarkable resilience even amidst high rates from the US Fed. The labour market is stable, GDP is growing, inflation is also not showing sharp fluctuations, and, with the exception of energy prices, it's in decline. Getting inflation under control has given the Fed grounds to discuss a possible rate cut. However, its tight monetary policy is still slowing down the GDP growth rate, as evidenced by global analysts' forecasts. After strong growth in Q3, it's expected to slow down in Q4. This is another reason in favour of the Fed cutting its key rate. The Fed's current monetary policy easing is harmful to the US dollar. In such a scenario, we could see USD/JPY resume its decline to 146.00. | |||||
![All eyes on the US Fed and Bank of England rate decisions [Weekly digest]](/sites/default/files/styles/image_300x120/public/news/shutterstock_2085891106_2.jpg?itok=MzO138_7)
