06.02.23 - 10.02.22
Results of the previous week
| BRN +5.34% | VIX +4.74% | SUGAR +4.16% |
AMC -29.55% | PA -4.77% | NQ -1.57% |
US indices showed a moderate decline last week. This was mainly because previously released macroeconomic statistics were quite strong (particularly the labour market report). One of the underlying catalysts for the momentum is expectations about what the US Federal Reserve will do with interest rates. Good news raises fears that the Fed will continue to tighten its monetary policy, which isn't very positive for the corporate sector.
Meanwhile, the Forex market traded mixed. The British pound recovered slightly from the losses suffered a week earlier. However, this looks like it's only a technical correction. On the other hand, the euro remained under pressure as the chairman of the Federal Reserve made it clear that the regulator's rate hike cycle isn't over yet, even despite lower inflation. Such news is seen as good for the dollar.
Brent oil continued its move to a price of $87 per barrel. The rise in energy prices is supported by hopes that demand will recover in China. In addition, markets are concerned about possible supply disruptions following the earthquake in Turkey. Russia's announcement that it will cut production by 500,000 barrels per day also positively impacted oil prices.
Key events of the current week
The US. Inflation rate | DATE 14.02 | GMT | FORECAST | PREV. | IMPORTANCE |
US inflation is gradually declining. This is unsurprising since the US regulator has repeatedly raised interest rates and has done so in a decisive fashion. At the same time, the labour market remains stable, and the US economy feels that way despite tightening monetary policy. At the Federal Reserve's last meeting, it made clear that it was prepared to continue its rate hikes and will keep an eye on incoming macrostatistics. The Fed could take a break if price pressure eases for another month. But such a move would most likely harm the dollar. In such a scenario, the EUR/USD could return to 1.0860. | |||||
The UK. Inflation rate | DATE 15.02 | GMT | FORECAST | PREV. | IMPORTANCE |
Inflation in the UK remains around historical highs. High energy prices have negatively affected the cost of most consumer goods and services. The Bank of England has repeatedly tightened its monetary policy even though rate hikes threaten a severe economic downturn. And, even if a slowdown in price pressure is in line with forecasts at this stage, it's unlikely that the regulator will change its pace. The current inflation rate is way higher than the target set by the central bank. The pound's first reaction to lower price pressure could be to fall further. The GBP/USD could aim to move toward 1.1890. | |||||
The US. Retail sales | DATE 15.02 | GMT | FORECAST | PREV. | IMPORTANCE |
The latest retail sales data were rather weak. That was especially surprising given that this was the holiday season when the indicator usually experiences a boom. Nevertheless, according to forecasts, the situation will start to balance out during earnings season. Overall, these expectations were completely vindicated as the labour market remains quite stable. The number of new non-farm payrolls increased again, and the unemployment rate is at a 50-year low. As such, if the report meets or beats expectations, the dollar could find support, which would negatively impact dollar-denominated assets. For example, silver (XAG/USD) could target a move towards $20.60. | |||||
