03.06.24 - 07.06.24
Results of the previous week
| NG +8.41 | COCOA +5.62% | NQ +1.89% |
SPCE -6.59% | PL -4.73% | VIX -2.92% |
Last week, US stock indices saw positive movement. They were primarily supported by a rebound in the technology sector. In addition, investors perceived the labour market data from ADP as something that could bring a US Fed rate cut closer. According to ADP, the number of people employed in the US economy increased by 152,000 versus a forecasted increase of 175,000.
The currency market once again saw mixed results. The dollar came under pressure from weak industrial PMI data, which fell to 48.7 against the previous result of 49.2. The index remained in the recession zone, i.e., below 50, which reinforced expectations of quantitative policy easing. At the same time, the pan-European currency virtually ignored the ECB's rate cut.
Brent crude oil prices in the first half of the week declined to $77 per barrel but later recovered to 80.00. US oil reserves data unexpectedly rose, putting pressure on oil prices. Black gold received moderate support after the ECB's rate cut and expectations that the Fed will follow suit under the influence of weak statistics from the US.
Key events of the current week
The UK. Labour market movements | DATE 11.06 | GMT | FORECAST | PREV. | IMPORTANCE |
The UK labour market is going through some pretty tough times. Over the course of last year, the unemployment rate rose to 4.3%. With rising unemployment, the number of job openings is falling (the ratio of unemployed to job openings has risen to 1.6 from 1.4 at the end of 2023), making it more difficult to find a job. Global analysts expect the negative employment dynamics to continue in the reporting period. Higher unemployment is a negative factor for the UK economy, where the service sector plays a significant role in GDP. The deterioration of key macro indicators is also bad news for the British pound. In this context, GBP/USD may return to the support level of 1.2680. | |||||
The US. Inflation rate | DATE 12.06 | GMT | FORECAST | PREV. | IMPORTANCE |
Revised US GDP data showed that growth slowed to 1.3% in the second quarter. The indicator declined more than forecast (1.6%). At the same time, inflation in the US is not easing. The indicator is holding at around 3.4%, well above the target level set by the US Federal Reserve. Global analysts forecast inflation remaining at 3.4%. High inflation will prevent the US Fed from moving to cut rates anytime soon. However, news on continued tight monetary policy are good for the US dollar. In this context, USD/JPY may return to the resistance level of 156.40. | |||||
US Federal Reserve rates decision | DATE 12.06 | GMT | FORECAST | PREV. | IMPORTANCE |
US Fed officials have repeatedly said they are willing to keep rates high for as long as it takes to get inflation under control, but inflation in the US isn't easing just yet. It currently sits at 3.4%, almost one and a half times as high as the Fed's target rate. As such, global analysts don't expect any surprises from the current meeting. They news are that the rate will remain at 5.5%. The Fed's continued high interest rate is good news for the US dollar but unfavourable for assets denominated in it, such as gold. Against this background, XAU/USD may continue to decline towards 2280.00. | |||||
