Skip to main content

XtremeMarkets

Xtreme Markets Ltd

Web Trader
Register
Download App
Login
Affiliates
Xtreme Markets Logo

Market News

EUR/USD Drops Toward 1.1700 as US Dollar Strengthens

EUR/USD Drops Toward 1.1700 as US Dollar Strengthens; FOMC Minutes in Spotlight

The EUR/USD pair slid to around 1.1705 during Wednesday’s Asian session, weighed down by renewed strength in the US Dollar. The Euro came under pressure following fresh tariff threats from former US President Donald Trump, which unsettled global markets and added to investor caution. 

Trump reignited global trade concerns by proposing a 50% tariff on copper imports and hinted at possible duties on semiconductors and pharmaceuticals. While he mentioned that negotiations with both the European Union and China are progressing well, he also warned that a tariff notice to the EU could be issued within days. This uncertainty has dented risk sentiment, putting the Euro under additional stress. 

Attention now turns to the Federal Reserve’s meeting minutes, due later today. Market participants are hoping for more clarity on the Fed’s rate path, especially amid growing expectations of monetary easing. 

At its June meeting, the Fed held interest rates steady, maintaining the federal funds rate between 4.25% and 4.50%—a level unchanged since December. However, markets are now pricing in a total of 50 basis points in rate cuts by year-end, potentially beginning as early as October. 

Read More
Australian Dollar Gains as Risk Sentiment Improves, RBA Decision in Focus

Australian Dollar Rises Amid Risk-On Sentiment, Focus Shifts to RBA Rate Decision

The Australian Dollar (AUD) continues its third straight session of gains against the US Dollar (USD) on Monday, following US President Donald Trump’s move to postpone the imposition of reciprocal tariffs. A weaker USD following disappointing US retail sales data has further supported the AUD/USD pair, reigniting speculation that the Federal Reserve (Fed) may cut interest rates later this year despite persistent inflation concerns.

Yet, the AUD’s gains could be capped before the Reserve Bank of Australia’s (RBA) policy announcement on Tuesday, as mounting speculation of a cut in interest rates deters sentiment. The RBA is widely expected to lower its Official Cash Rate (OCR) by 25 basis points (bps) to 4.10%, marking the first rate reduction in four years.

US Dollar Under Pressure Amid Lower Treasury Yields

The US Dollar Index (DXY) is down for the third consecutive session, bogged down by weaker US Treasury yields. At the time of writing, the DXY is trading around 106.70, with 2-year and 10-year Treasury bond yields at 4.26% and 4.47%, respectively.

Statistics released by the US Census Bureau on Friday indicated that US Retail Sales decreased 0.9% in January, a reversal from a revised 0.7% rise in December (earlier reported as 0.4%). The decrease was deeper than the market expectation of a 0.1% decline.

Conversely, Core PPI inflation in the US increased to 3.6% YoY in January, above expectations of 3.3%, though marginally less than the revised 3.7% (initially published as 3.5%). This has consolidated expectations that the Fed will push rate cuts until the second part of the year.

The US Consumer Price Index (CPI) rose 3.0% YoY in January, beating expectations of 2.9%, and core CPI (excluding food and energy) went up to 3.3% from 3.2%, beating expectations of 3.1%. On a month-on-month basis, headline inflation rose 0.5% in January compared to 0.4% in December, with core CPI rising to 0.4% from 0.2% in the same period.

Fed Officials Signal a Cautious Approach to Rate Cuts

In his semi-annual report to Congress, Fed Chair Jerome Powell stated that policymakers “do not need to be in a hurry” to cut interest rates, citing a strong labor market and robust economic growth. Powell also warned that Trump’s tariff policies could exert upward pressure on inflation, making it harder for the central bank to lower rates.

A Reuters poll of economists now indicates the Fed will wait until next quarter to cut rates, citing ongoing inflationary concerns. Although previously, some analysts anticipated a March rate cut; the majority now sees at least one rate cut by June, but opinions remain divided.

Federal Reserve Bank of Cleveland President Beth Hammack echoed this sentiment, saying that maintaining rates at current levels for a long time is probably the right thing to do. Hammack added that a patient strategy will enable the Fed to evaluate economic conditions before altering policy.

Australian Dollar Targets Upper Range Near 0.6400

The AUD/USD currency pair quotes at 0.6360 on Monday, with an uptrend in a rising channel formation. This is indicative of a bullish market inclination, which is also complemented by the 14-day Relative Strength Index (RSI) remaining above 50.

On the upside, the pair could test the upper boundary of the ascending channel at 0.6380, followed by the psychological level of 0.6400.

Major levels of support are the nine-day EMA at 0.6310, followed by the 14-day EMA at 0.6294. A fall below these levels may erode short-term momentum, possibly pulling the pair down to the lower boundary of the rising channel at 0.6270.

Read More
Australian Dollar Declines as US Dollar Strengthens Ahead of Jobless Claims

Australian Dollar Declines as US Dollar Holds Gains Ahead of Jobless Claims

The Australian Dollar (AUD) fell against the US Dollar (USD) on Thursday as trade balance data came in below average than expected. Furthermore, risk-off sentiment, fueled by rising US-China trade tensions, weighs on the AUD/USD.

In December, Australia’s trade surplus fell to $5,085 million, falling short of the 7,000 million anticipated and down from $6,792 million the previous year. While exports increased by 1.1% month on month, this was a decrease from November’s 4.2% increase, while imports increased by 5.9% month on month, much more than the previous 1.4% gain.

US-China Trade Tensions Weigh on Australian Dollar

Investors are still focused on the current trade stagnation between the United States and China, Australia’s top trading partner. China replied to the United States’ new 10% tax, which went into force on Tuesday, causing global market concern. Regarding the situation, President Trump announced on Monday that he intends to engage with China within the next 24 hours. However, he cautioned that failure to achieve an agreement might result in “very, very substantial” tariffs.

Meanwhile, China’s Commerce Ministry imposed a 15% tax on US coal and liquefied natural gas (LNG) imports, as well as an additional 10% levy on crude oil, farm equipment, and some autos. As a countermeasure, China has implemented export limits on important minerals such as tungsten, tellurium, ruthenium, and molybdenum, citing national security concerns.

Amid escalating trade tensions, the Financial Times writes that Chinese firms are quickening preparations to relocate production overseas, mainly to the Middle East, in order to reduce tariff impacts. Some exporters are also considering passing on prices to US consumers or expanding into new markets.

US Dollar Holds Firm Amid Mixed Economic Data

The US Dollar Index (DXY), which tracks the greenback’s performance against a basket of six major currencies, remains stable near 107.50, putting further downward pressure on the AUD/USD. The dollar’s resiliency comes after a weaker-than-expected US Services PMI fell to 52.8 in January, below the market forecast of 54.3.

Investors now focus on Friday’s US Nonfarm Payrolls (NFP) data, a key economic indicator that could influence the Federal Reserve’s monetary policy stance.

The dollar fell on Wednesday, following a poor US Services PMI report. The ISM Services PMI fell to 52.8 in January from a revised 54.0 in December, missing the market forecast of 54.3. Looking ahead, traders are anticipating Friday’s US Nonfarm Payrolls (NFP) report, which could influence the Federal Reserve’s future policy moves.

Technical Outlook: AUD/USD Pulls Back From 0.6300, Eyes Key Support

The AUD/USD pair hovers near 0.6280 on Thursday, retreating from the 0.6300 level. However, sustained trading above the nine- and 14-day Exponential Moving Averages (EMAs) suggests short-term bullish momentum remains intact. The 14-day Relative Strength Index (RSI) is also holding above 50, reinforcing the bullish bias.

On the upside, the pair might target 0.6330, its seven-week high from January 24.

Immediate support comes from the nine-day EMA near 0.6254, followed by the 14-day EMA at 0.6249.

A breach below these levels might weaken the bullish structure, potentially sending the pair below 0.6087, its lowest level since April 2020, which was recorded on February 3.

Read More
Australian Dollar Slips as US Tariffs on China Take Effect

Australian Dollar Slips as US Tariffs on China Take Effect

The Australian Dollar (AUD) falls for the seventh consecutive day as the US Dollar (USD) strengthens following President Donald Trump’s 10% tariff on Chinese imports. Market volatility remains high as investors monitor the continuing US-China trade talks. Trump signaled he may speak with Chinese officials within the next 24 hours, warning that if a deal isn’t reached, tariffs on China will be “very, very substantial.”

Trump also announced a 30-day tariff relief for Mexico and Canada after their nations agreed to send 10,000 troops to the US border to battle drug trafficking. This move follows the introduction of 25% tariffs on Mexican and Canadian goods just two days before.

Chinese Exporters Seek Alternatives

According to the Financial Times, Chinese manufacturers are speeding up plans to transfer production offshore in reaction to US tariffs. Some companies are considering relocating to regions such as the Middle East, while others are looking into passing costs on to US customers or entering new markets.

RBA Rate Cut Expectations Weigh on AUD

The AUD faces additional pressure amid growing expectations that the Reserve Bank of Australia (RBA) may cut rates in February. The RBA has maintained the Official Cash Rate (OCR) at 4.35% since November 2023, stressing that inflation must return to its 2%-3% target range before easing policy.

Analysts at Westpac continue to forecast 100 basis points of rate cuts in 2025, with the market pricing in a more conservative outlook. ANZ, CBA, Westpac, and National Australia Bank (NAB) all anticipate a 25-basis-point (bps) cut in February, with NAB recently revising its forecast forward from May.

US Dollar Strengthens Amid Economic Developments

The US Dollar Index (DXY) stabilizes around 108.70 after erasing gains from the previous session. Recent US economic data support the greenback, with ISM Manufacturing PMI rising to 50.9 in January from 49.3 in December, exceeding expectations of 49.8.

Inflation indicators remain in focus as the Fed’s preferred measure, the Personal Consumption Expenditures (PCE) Price Index, rose 0.3% MoM in December, up from 0.1% in November. Annual PCE inflation increased to 2.6%, while core PCE held steady at 2.8% YoY for the third straight month.

Jerome Powell, Chairman of the Federal Reserve, highlighted that further policy adjustments would be required if there was clear evidence of inflation advance or labor market weakness. Separately, Treasury Secretary Scott Bessent recently argued for new uniform taxes on US imports, beginning at 2.5% and progressively increasing—a departure from his previous stance that tariffs cause inflation.

Australian Dollar Technical Analysis

AUD/USD trades around 0.6210 on Tuesday, remaining within a descending channel pattern on the daily chart, signaling a bearish bias. However, the 14-day Relative Strength Index (RSI) is recovering toward the 50 level, suggesting weakening downside momentum. A breakout above the channel, combined with an RSI move above 50, could indicate a shift toward a bullish outlook.

On the downside, the pair may test the descending channel’s lower boundary near 0.6150. A break below this level could drive AUD/USD toward 0.6087, its lowest point since April 2020.

AUD/USD is currently testing its initial resistance, the nine-day Exponential Moving Average (EMA) of 0.6225, which aligns with the channel’s upper limit. A decisive move over this level could fuel bullish optimism.

 

Read More
Japanese Yen Maintains Strong Bullish Momentum

Japanese Yen Maintains Strong Bullish Momentum; USD/JPY Struggles Below 154.50

The Japanese Yen (JPY) continues to strengthen in early European trading on Thursday, pushing USD/JPY further below 154.50 and closer to its one-month low from earlier this week. Market expectations that the Bank of Japan (BoJ) will hike interest rates again by year-end continue to support the JPY. Additionally, a fresh decline in US Treasury bond yields, narrowing the US-Japan yield differential, has further boosted demand for the lower-yielding Yen.

However, concerns over the potential economic impact of US President Donald Trump’s trade policies may limit aggressive JPY buying. Meanwhile, the Federal Reserve’s (Fed) hawkish pause on Wednesday has bolstered the US Dollar (USD), which could provide some support to the USD/JPY pair. Traders are now looking ahead to the European Central Bank (ECB) meeting, which may increase market volatility and drive further demand for the safe-haven Yen. Additionally, the Advance US Q4 GDP report could introduce short-term trading opportunities.

JPY Gains on Hawkish BoJ Sentiment Amid Market Uncertainty

  • Minutes from the BoJ’s December meeting, released Wednesday, indicated discussions on using neutral interest rate estimates to guide future rate hikes.
  • Former BoJ board member Makoto Sakurai stated on Tuesday that steady rate increases remain feasible due to rising wages, sustained inflation, and strong economic growth.
  • The Federal Reserve, as expected, held rates steady after its two-day meeting and signaled no immediate plans for rate cuts.
  • Fed Chair Jerome Powell emphasized a patient stance, stating there is no urgency to adjust policy and reaffirming that rates will stay elevated amid concerns over Trump’s trade policies, which could fuel inflation.
  • The 10-year US Treasury yield has struggled to sustain gains post-FOMC due to uncertainty surrounding the Trump administration’s economic policies.
  • Reports from Asahi newspaper indicate that Japan’s Prime Minister Shigeru Ishiba is finalizing plans for a February 7 meeting with US President Donald Trump in Washington.
  • The ECB’s policy decision later today is expected to introduce further volatility, alongside the Advance US Q4 GDP print.

USD/JPY at Risk of Retesting Monthly Lows Near 153.70

The USD/JPY pair faced renewed selling pressure near the 156.00 level, breaking below the key 155.00 psychological mark, confirming a multi-month ascending channel breakdown. Momentum indicators on the daily chart suggest continued downside movement, making a retest of the 153.70 region—a multi-week low touched on Monday—a strong possibility.

Key resistance levels for a rebound:

  • 155.00 round figure
  • 155.35-155.40 region
  • 156.00 psychological level

Any recovery attempt is likely to face selling pressure near these levels. A sustained break above 156.25 could trigger short-covering, potentially lifting USD/JPY toward 156.70-156.75, with further resistance at 157.00 and 157.60.

For now, the bias remains bearish, with further losses expected if the pair stays below 154.00. Traders will closely watch US data and global central bank policy updates for the next directional move.

Read More
Gold Price Retreats from Multi-Month High Amid USD Recovery

Gold Price Retreats from Multi-Month High Amid USD Recovery

Gold price (XAU/USD) faces selling pressure at the beginning of the week, pulling back from its highest level since late October, near the $2,786 mark touched on Friday. The US Dollar (USD) has staged a modest recovery following its worst weekly performance since November 2023, which has weighed on the precious metal. However, the broader market dynamics remain supportive of a bullish outlook, suggesting potential dip-buying opportunities at lower price levels.

Market Sentiment Dampened by Trade Tensions and Fed Speculation

Risk sentiment has deteriorated due to US President Donald Trump’s recent decision to impose tariffs on all imports from Colombia, reigniting fears of a trade war. Additionally, expectations that the Federal Reserve (Fed) may cut interest rates twice by year-end, combined with a flight to safe-haven assets, have triggered a fresh decline in US Treasury bond yields. This decline could limit aggressive gains in the USD, potentially cushioning the downside for gold, a non-yielding asset.

Gold Under Pressure from USD Recovery, but Downside Remains Limited

The US Dollar Index (DXY), which tracks the USD against a basket of currencies, rose nearly 0.25% on Monday, driven by revived concerns over US trade policies. President Trump ordered 25% emergency tariffs on all Colombian imports following the country’s refusal to accept deported migrants from the US, with a threat to raise tariffs to 50% next week. Moreover, reports suggest that Trump’s advisors are considering imposing 25% tariffs on Mexico and Canada starting February 1.

In a recent update, the White House confirmed that Colombia has agreed to Trump’s demands, including the unrestricted acceptance of deported individuals. Meanwhile, Trump has reiterated his call for immediate interest rate cuts, fueling speculation of further easing by the Federal Reserve in 2025. The resulting decline in US Treasury yields may act as a headwind for the USD, potentially limiting the extent of gold’s pullback.

Traders Eye Economic Data for Further Clues

Market participants will turn their focus to key US economic data, including Durable Goods Orders, the Conference Board’s Consumer Confidence Index, and the Richmond Manufacturing Index, for fresh impetus during the US trading session.

Gold Price Outlook: Support and Resistance Levels

Gold’s recent decline may attract dip-buying near the $2,736 support zone, as the technical setup remains bullish. Any further slide below the $2,750-2,748 range could find solid support near $2,736, with additional key levels at $2,725-2,720. A break below $2,720 could trigger technical selling, pushing prices toward the $2,665-2,662 zone.

On the upside, a sustained move above the $2,772-2,773 resistance could open the door for a retest of the recent peak near $2,786. Further buying momentum beyond the $2,800 psychological level could signal a renewed bullish phase, extending the upward trend

Read More
Gold Price Holds Defensive Below Multi-Month High Amid Risk-On Sentiment

Gold Price Remains Defensive Below Multi-Month High Amid Risk-On Sentiment

Gold price (XAU/USD) came under selling pressure during the Asian session on Thursday, retreating from the multi-month high of $2,763–$2,764 touched the previous day. This decline halts a three-day winning streak. The US Dollar (USD) gained some strength from its recovery off a monthly low, supported by a rebound in US Treasury bond yields, and the upbeat sentiment in equity markets further dampened demand for the safe-haven metal.

Signs of easing inflation in the US have fueled expectations that the Federal Reserve (Fed) might cut interest rates twice this year, creating a potential headwind for US bond yields and the USD. However, ongoing uncertainty surrounding President Donald Trump’s tariff plans, which could increase trade tensions and market volatility, may help limit the downside for gold prices. Traders may remain cautious and wait for sustained selling pressure to confirm that the one-month uptrend has ended.

Risk-On Mood and Modest USD Rebound Cap Gold Gains

The USD steadied above its recent lows amid recovering Treasury yields, adding pressure to gold prices. In addition, easing geopolitical tensions and a lack of concrete details regarding Trump’s tariff policies have maintained a risk-on sentiment, further undermining gold’s appeal.

While Trump’s proposed tariff policies are considered inflationary, which could prompt the Fed to maintain a hawkish stance, markets are still pricing in at least two Fed rate cuts this year. This outlook may limit the upside for US bond yields and the USD, potentially supporting gold in the near term.

Investors are eyeing Trump’s speech at the World Economic Forum for more clarity on tariffs, alongside the release of US Weekly Jobless Claims, which could influence XAU/USD prices. Upcoming central bank rate decisions, including the Bank of Japan’s meeting on Friday and next week’s announcements from the Fed and the European Central Bank, could inject volatility into the market and impact gold prices.

Gold Price Technical Analysis

Key Support Levels:

  • Immediate support is seen near the $2,725–$2,720 zone, a former resistance-turned-support level.
  • Further declines could target the $2,700 mark, with a decisive break paving the way for a move toward the $2,665–$2,662 region.
  • The $2,627–$2,622 confluence, which includes the 100-day EMA and a short-term ascending trendline, will act as a critical pivot point for short-term traders.

Key Resistance Levels:

  • The recent high near $2,763–$2,764 offers the first resistance level.
  • A break above this zone could see gold prices challenge the all-time high around $2,790, reached in October.
  • The $2,800 mark is the next significant resistance, and a break above it would signal a continuation of the well-established uptrend over the past month.

Outlook:

Gold prices remain influenced by risk sentiment, central bank policy expectations, and USD movements. While near-term bearish factors may limit gains, uncertainty around US tariff policies and inflation trends could provide support, making any dips near key technical levels potential opportunities for dip-buying. Traders will remain focused on upcoming economic data and central bank decisions for further direction.

Read More
Gold Price Consolidates Below $2,750 Amid Mixed Market Signals

Gold Price Consolidates Below $2,750 Amid Mixed Market Signals

Gold prices (XAU/USD) continue to trade within a narrow range near the $2,740 level during early European trading on Tuesday. The market remains influenced by conflicting factors, leaving traders hesitant to make strong directional moves.

US President Donald Trump’s renewed trade tariff threats have sparked inflationary concerns, driving a modest rebound in US Treasury bond yields. This, in turn, supports a recovery in the US Dollar (USD) from its recent one-month low, creating downward pressure on gold prices.

However, fears of potential economic disruptions from Trump’s trade policies are providing support for the safe-haven asset, helping limit its downside. Market participants are also exercising caution ahead of the upcoming two-day Federal Open Market Committee (FOMC) meeting, while US macroeconomic data due later in the day could further influence market sentiment.

Key Developments Impacting Gold Prices

  1. Trade Tariff Concerns:
    President Trump recently announced emergency tariffs of 25% on Colombian imports, though implementation was delayed following an agreement on the acceptance of illegal migrants returned from the US. Trump also signaled impending tariffs on pharmaceuticals, computer chips, aluminum, copper, and potentially steel. These moves have heightened fears of inflation and pushed US Treasury bond yields higher, bolstering the USD and weighing on gold.
  2. Monetary Policy Speculation:
    Despite Trump’s tariff announcements, markets are pricing in two potential 25-basis-point interest rate cuts by the Federal Reserve this year. This expectation could cap bond yields and limit USD gains, offering some support to gold prices.
  3. Data and Events to Watch:
    Later on Tuesday, US economic data such as Durable Goods Orders, the Conference Board’s Consumer Confidence Index, and the Richmond Manufacturing Index may provide additional trading cues. The spotlight will then shift to Wednesday’s FOMC decision, which could significantly impact USD dynamics and set the tone for gold’s next directional move.

Technical Outlook: Resistance and Support Levels

Gold prices showed resilience on Monday, holding above the 23.6% Fibonacci retracement level of the December-January uptrend. Daily chart oscillators remain in positive territory, reinforcing the case for an upward bias.

  • Support Levels:
    Immediate support lies near $2,730, followed by the $2,725-2,750 zone. A break below these levels could push prices toward the 38.2% Fibonacci retracement level near $2,707-2,705, and further to the 50% level around $2,684.
  • Resistance Levels:
    The nearest resistance is at $2,755-2,757, with further hurdles at $2,772-2,773 and $2,786. A decisive break above $2,800 would signal renewed bullish momentum, potentially leading to a test of the all-time high near $2,790 and further gains.

Outlook for Gold

Gold prices remain range-bound as traders weigh opposing forces of inflationary concerns and safe-haven demand. A move above $2,755-2,757 is necessary for bulls to regain control in the short term, while a break below $2,730 would signal deeper corrections. With critical economic data and the FOMC decision on the horizon, gold’s next big move may hinge on shifting market dynamics in the coming days.

Read More

Supermicro Stock Skyrockets 29% After Investigation Clears Fraud Allegations

Super Micro Computer (NASDAQ: SMCI), popularly known as Supermicro, saw its stock price soar by 29% on Monday, closing around $42 per share. This significant jump follows the conclusion of a governance investigation that found no evidence of fraud or misconduct, boosting investor confidence.

Investigation Findings: No Fraud or Misconduct

The investigation, initiated by a special committee in August, addressed concerns raised by Ernst & Young (EY), Supermicro’s former auditor, regarding governance, sales practices, and financial reporting. Key findings include:

  1. Management Integrity: The committee found no substantial concerns regarding the integrity of Supermicro’s senior management, audit committee, or financial reporting practices.
  2. Audit Independence: The audit committee demonstrated appropriate independence and oversight during financial reporting.
  3. Rehiring Practices: The company’s decision to rehire certain employees was deemed consistent with a commitment to legal compliance and accurate financial reporting.

EY’s concerns were ultimately found unsupported, with the committee emphasizing the accuracy of interim and final findings.

Governance Overhaul and Next Steps

To strengthen its governance, Supermicro has embraced the committee’s recommendations, including:

  • Leadership Appointments: Hiring a new Chief Financial Officer (CFO), appointing Kenneth Cheung as Chief Accounting Officer, and recruiting a Chief Compliance Officer and General Counsel.
  • Enhanced Oversight: Improving internal accounting and compliance systems, with better training, monitoring, and oversight practices.

The company has also filed a compliance plan with Nasdaq to catch up on overdue financial reports, ensuring continued listing.

Stock Performance: Recovery in Progress

Supermicro’s stock had plummeted by 85% in mid-November, hitting $17 per share, following its October 10-for-1 stock split and governance concerns. However, confidence rebounded after the investigation’s positive findings. Since November 15, the stock has surged back to $42, marking a 48% year-to-date increase.

With a price-to-earnings (P/E) ratio dropping from 79 in March to 16, Supermicro’s valuation is now drawing comparisons to AI-driven market leaders like NVIDIA. Its focus on AI-enabled servers for high-performance computing positions it as a key player in the tech sector.

Investor Considerations

While the governance investigation cleared Supermicro of fraud, investors are advised to exercise caution until the company releases its delayed financial reports. These filings will provide deeper insights into its financial health and help solidify its recovery. For now, Supermicro’s low valuation and strong earnings potential make it a compelling, albeit cautious, investment opportunity.

Read More
Asian Stocks Decline on Geopolitical Tensions; Nikkei Falls on Inflation Data

Asian Stocks Drop Amid Geopolitical Tensions; Nikkei Slides on Strong Inflation Data

Asian Stocks Drop Amid Geopolitical Tensions; Nikkei Slides on Strong Inflation Data

Asian equities fell on Friday as geopolitical concerns and strong economic data from Japan weighed on sentiment. The escalation of the Russia-Ukraine conflict further dampened risk appetite, while China’s tech sector provided a rare bright spot amid easing regulatory fears.

Key Market Highlights

Geopolitical Tensions Weigh on Markets
Russia intensified its attacks on Ukraine, targeting energy infrastructure and escalating the conflict. President Vladimir Putin issued threats to strike decision-making centers in Kyiv with ballistic missiles, exacerbating global geopolitical uncertainty.

Broad Declines Across Asia

  • Thailand’s SET Index: Dropped 0.2%.
  • Indonesia’s Jakarta Composite: Declined 0.8%.
  • South Korea’s KOSPI: Fell nearly 2%, driven by a 1.8% drop in Samsung Electronics and a 0.7% decline in SK Hynix. Concerns over slowing economic growth deepened after data showed declines in industrial output, retail sales, and facility investment in October.
  • Australia’s ASX 200: Edged 0.3% lower.
  • Malaysia’s KLCI: Dipped 0.2%.

Japan’s Nikkei Slips Amid Yen Strength
Japan’s Nikkei 225 fell 0.5%, and the TOPIX index declined 0.3% as the yen strengthened to a one-month high against the U.S. dollar. Strong inflation data from Tokyo fueled speculation of a Bank of Japan (BOJ) rate hike in December.

  • Tokyo’s core consumer prices exceeded expectations in November, highlighting persistent inflationary pressures.
  • BOJ Governor Kazuo Ueda signaled plans to tighten monetary policy further, supported by a “virtuous cycle” of rising wages and steady inflation.

Chinese Tech Stocks Buck the Trend
Contrary to broader declines, Chinese equities rallied:

  • Shanghai Shenzhen CSI 300: Rose 1.6%.
  • Shanghai Composite: Gained 1.4%.
  • Hang Seng Index: Jumped 1.3%.

Reports suggested that the U.S. may impose less severe sanctions on China’s semiconductor industry than initially feared.

  • Semiconductor Manufacturing International Corp (SMIC) surged over 4%.
  • Hua Hong Semiconductor climbed 3.7%.

Investors are optimistic about Beijing’s recent stimulus measures, and a Reuters poll anticipates modest growth in China’s manufacturing Purchasing Managers’ Index for November, due Saturday.

Outlook

The Asia-Pacific region remains under pressure from geopolitical risks and mixed economic signals. Japan’s inflation dynamics could shift BOJ policy, while China’s tech rally might offer temporary relief amid broader concerns of an economic slowdown.

Read More
WTI Steady at $69 Amid Geopolitical Risks and US Crude Inventory Build

WTI Steadies Near $69.00 Amid Mixed Signals from Geopolitical Risks and US Crude Inventory Build

WTI Steadies Near $69.00 Amid Mixed Signals from Geopolitical Risks and US Crude Inventory Build

West Texas Intermediate (WTI), the US benchmark for crude oil, is trading near $68.95 during Thursday’s session, maintaining a steady stance amid conflicting market drivers. A modest build in US crude inventories and weak Chinese demand weigh on prices, while escalating geopolitical tensions between Russia and Ukraine offer potential support.

US Crude Inventory Build Weighs on Prices
The Energy Information Administration (EIA) reported an increase of 0.545 million barrels in US crude stockpiles for the week ending November 15, slightly above market expectations of a 0.400 million barrel rise but significantly lower than the previous week’s 2.089 million barrel build. The smaller-than-expected inventory increase adds mild pressure to oil prices.

Weak Chinese Demand Adds Downside Pressure
China’s demand for crude oil continues to show weakness, dampening the outlook for global consumption. In October, China’s crude oil demand fell by 5.4% year-on-year. The International Energy Agency (IEA) projects demand growth in China to reach just 140,000 barrels per day (bpd) for 2024, a sharp decline compared to the 1.4 million bpd growth seen in 2023.

Geopolitical Risks Provide Support
Heightened geopolitical tensions involving major oil producers Russia and Ukraine are keeping supply-side concerns alive. This week, Russia accused Ukraine of targeting a facility in the Bryansk region with ATACMS missiles, prompting Russian President Vladimir Putin to lower the threshold for a potential nuclear response. Such risks could disrupt oil supplies, offering a counterbalance to bearish demand factors.

John Kilduff, a partner at Again Capital, highlighted, “These risks to supply are definitely keeping the support here and offsetting to a degree concerns around the global demand outlook.”

Outlook
WTI prices remain at the mercy of mixed signals, with inventory builds and sluggish Chinese demand capping gains while geopolitical risks lend underlying support. Traders will look toward further updates on geopolitical developments and upcoming economic data to gauge the balance between supply and demand factors in the oil market.

Read More
Gold Prices Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold Prices Remain Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold Prices Remain Under Pressure as Stronger USD Weighs Ahead of Fed Decision

Gold (XAU/USD) continues to trade lower for the second consecutive session on Thursday, impacted by a stronger U.S. Dollar following former President Donald Trump’s victory in the recent U.S. election. The dollar-denominated precious metal is seeing diminished safe-haven appeal as market optimism increases, supported by clearer political outcomes.

Investor focus is now on the upcoming U.S. Federal Reserve decision, with markets largely anticipating a 25 basis-point rate cut. If realized, this could offer some support for Gold, as lower interest rates tend to reduce the opportunity cost of holding non-yielding assets like precious metals. The CME FedWatch Tool currently indicates a 98.1% likelihood of this modest rate reduction.

Market Dynamics: Gold Struggles Amid Higher Yields and “Trump Trades”

Non-yielding Gold faces additional pressure from surging U.S. Treasury yields, with the 2-year and 10-year bond yields hitting 4.31% and 4.47%, respectively, their highest levels since July. Furthermore, the prospect of increased inflation due to Trump’s policy stance, which includes higher trade tariffs and fiscal spending, could prompt some investors to seek Gold as a long-term inflation hedge.

Trump’s proposed economic policies—such as imposing tariffs, expanding the fiscal deficit, and cutting taxes—might conflict with the Federal Reserve’s inflation control goals, likely resulting in a slower pace of monetary easing.

Gold prices have been relatively unaffected by ongoing geopolitical tensions, including Iran’s warning of potential retaliation against Israel’s recent actions.

Additionally, mixed U.S. economic data from this week’s ISM and PMI releases reflect a resilient services sector. The ISM Services PMI rose to 56.0 in October from 54.9 in September, exceeding forecasts, while the S&P Global Services PMI reported a slight dip, coming in at 55.0.

Technical Outlook: Key Support and Resistance Levels for Gold

Gold currently trades near $2,650 per ounce, with technical indicators suggesting a continuation of bearish momentum. On the daily chart, Gold remains below the nine- and 14-day Exponential Moving Averages (EMAs), and the 14-day Relative Strength Index (RSI) remains under 50, both indicating a bearish trend.

On the downside, the next support level sits around $2,603.53, representing a three-week low. A break below this level could push Gold toward the critical $2,500 mark.

Conversely, immediate resistance is found near the psychological level of $2,700, with further resistance at the nine-day EMA of $2,711.40. A breakout above this zone could position Gold to retest its recent high of $2,790.11 reached on October 31.

Read More

Gold Price Holds Steady Near Record High, Awaits US Macro Data for Direction

Gold Price Holds Steady Near Record High, Awaits US Macro Data for Direction

Gold price (XAU/USD) remains robust as it approaches the European session on Tuesday, trading just above the $2,750 mark and close to last week’s all-time high. Geopolitical risks and political uncertainties in the US continue to boost demand for the safe-haven metal. Additionally, lower US Treasury yields and cautious market sentiment lend further support to gold.

At the same time, expectations for smaller Federal Reserve (Fed) rate cuts are expected to support US bond yields, which could help the US Dollar (USD) recover some of the previous session’s losses. This, in turn, tempers new bullish momentum in non-yielding gold as investors await key US economic data releases this week, likely to influence the Fed’s rate outlook and provide new direction for XAU/USD.

Market Movers: Gold Supported by Mixed Factors, USD Buying Limits Gains

The retreat in US Treasury yields led to an intraday pullback in the USD from recent highs, encouraging some dip-buying near $2,725 early this week. Recent positive US data dampened expectations for substantial Fed rate cuts, potentially bolstering bond yields amid concerns about deficit spending after the November 5 election. With the US election drawing near, markets face additional uncertainty as Vice President Kamala Harris and Republican candidate Donald Trump engage in a close race for the presidency. Moreover, heightened tensions in the Middle East have added to market caution, with the US warning Iran of potential consequences if it continues retaliatory strikes.

In the broader market, China reported an 11.18% decline in gold consumption year-over-year for the first three quarters, citing high prices as a dampening factor on jewelry demand. Investors now eye the upcoming US Consumer Confidence Index and Job Openings and Labor Turnover Survey (JOLTS) for insight into the Fed’s rate plans and USD dynamics, likely to affect short-term gold price movements.

Technical Outlook: Gold Awaits Breakout for Bulls to Regain Control

On the technical front, a sustained move above the $2,750 resistance could trigger further buying interest, pushing gold prices past the all-time high around $2,759 and towards the four-month-old ascending trend-line resistance at $2,770–2,775. A continued rally could eventually target the psychological $2,800 level.

However, the Relative Strength Index (RSI) on the daily chart is approaching overbought levels, signaling potential caution for bulls. A short-term consolidation or minor pullback could provide a better entry for additional upside.

If a corrective decline occurs, support could emerge near the $2,725 level, followed by $2,715—the lower boundary of a recent trading range. A decisive break below this range might prompt technical selling, potentially leading gold prices below $2,700 and toward the $2,675 and $2,657–2,655 support areas.

Read More
WTI Struggles Below $70 Amid Demand Concerns and USD Strength

WTI Struggles Below $70 Amid Demand Concerns and USD Strength

WTI Struggles Below $70 Amid Demand Concerns and USD Strength

West Texas Intermediate (WTI) crude oil prices are hovering just below the $70.00 mark during Tuesday’s Asian session, remaining in a tight range around $69.70-$69.75. The commodity has struggled to build on the previous day’s modest gains and stays near the three-week low it touched last Friday. WTI seems vulnerable to continuing its recent downtrend, which has persisted for over two weeks.

The brief positive reaction to the People’s Bank of China’s (PBOC) interest rate cut on Monday was short-lived, as concerns about slowing demand, particularly from China, continued to weigh on oil prices. Both OPEC and the International Energy Agency (IEA) reduced their global demand forecasts last month due to economic challenges in China, the world’s largest oil importer. IEA chief Fatih Birol further fueled these concerns, warning that China’s economic weakness could dampen global oil demand for years to come.

Adding to WTI’s challenges, the US Dollar (USD) has surged to its highest level since early August, driven by expectations of more cautious monetary easing from the Federal Reserve (Fed). A stronger USD tends to weigh on oil prices by making crude more expensive for holders of other currencies.

However, the potential for further escalation in the Middle East conflict, which could disrupt oil supplies from the region, provides some support to WTI prices. This geopolitical risk cautions against overly bearish positions, despite the recent sharp drop from the nearly two-month high of $78.00 reached on October 8.

Read More

XAG/USD Vulnerable, Aiming for $22.20-$22.10 Retest

XAG/USD Vulnerable, Aiming for $22.20-$22.10 Retest

Silver witnessed a fleeting upward movement during the Asian trading session, attempting to breach the pivotal $23.00 level. However, this surge was short-lived, with silver unable to maintain the momentum required to sustain a position above this critical threshold. Delving into the intricacies of this price action, the breach below the $22.85-$22.80 support range signifies a significant shift in market sentiment that leans decidedly bearish. This sentiment is further corroborated by closely examining the oscillators on the daily chart, which appear to signal the potential for further downward movement.

The repercussions of this bearish sentiment set the stage for a testing period for silver as it gears up for a retest of the robust support zone in the $22.20-$22.10 range. In more pessimistic scenarios, the price could venture even lower, extending its downward trajectory to the $21.25 region.

In the event of a shift in momentum favoring the upside, silver would encounter various resistance levels. Initially, surpassing the psychological hurdle at $23.00 would be met with a resistance barrier of around $23.20. Further upward momentum would then contend with the presence of the 200-day Simple Moving Average, a key technical indicator, which is situated within the $23.45-$23.50 range. Beyond this, the 100-day SMA would pose another formidable obstacle at approximately $23.80, closely followed by the psychologically significant $24.00 level.

Should market dynamics and trader sentiment align so that these resistance levels are convincingly breached, it would represent a significant departure from the prevailing negative outlook that currently shrouds XAG/USD. This potential turning point could set the stage for a short-covering rally, propelling silver past the confines of the $24.30-$24.35 range. At this juncture, the coveted target for traders is the psychological and strategically significant level of $25.00, a threshold that corresponds notably with the August monthly swing high.

Attainment of the $25.00 level would constitute a pivotal moment for the market, potentially recalibrating prevailing sentiment from bearish to bullish. Such an achievement would signify renewed optimism among traders, acting as a catalyst for further gains in silver. Thus, market participants will keenly monitor price action around the $25.00 level, recognizing its capacity to redefine the trajectory of XAG/USD in the near term and offer crucial insights into the market’s direction.

Read More
US PCE Data Approaches

WTI Crude Oil Rises Above $87 as Supply Cuts and China’s Recovery Boost Prices

WTI Crude Oil Rises Above $87 as Supply Cuts and China’s Recovery Boost Prices

WTI Crude Oil has surged above $87 per barrel, reaching its highest since November 2022. The rise in prices can be attributed to several factors, including extended production cuts by Saudi Arabia and Russia, as well as positive economic developments in China.

Saudi Arabia and Russia, both major players in the oil market, have recently announced that they will continue cutting oil production for the rest of the year. This decision has created a sense of supply tightness and supported the upward movement of WTI prices. Saudi Arabia, in particular, will reduce its crude output to approximately 1.3 million barrels per day until the end of 2023.

China’s improving economic conditions have also played a role in boosting WTI prices. As the world’s largest oil importer, any positive signs from China have a significant impact on the market. The country’s Consumer Price Index (CPI) for August showed a 0.1% year-on-year increase, signaling a decrease in deflation concerns compared to the previous month’s 0.3% drop. This improvement has further bolstered confidence in the oil market.

However, there are potential factors that may limit the upward trajectory of WTI prices. Recent positive economic data from the United States, especially concerning interest rates, could have an impact. Higher interest rates can result in increased borrowing costs, potentially slowing down economic growth and subsequently reducing oil demand.

Oil traders will closely monitor upcoming data releases, such as the API Weekly Crude Oil Stock and EIA Crude Oil Stocks Change reports, as well as the US Consumer Price Index (CPI). These events have the potential to significantly influence the value of WTI and present opportunities for oil traders to capitalize on market fluctuations.

In summary, WTI Crude Oil has experienced a notable surge, surpassing $87 per barrel, driven by production cuts by major oil exporters and positive economic indicators from China. However, the potential impact of interest rates and upcoming data releases should be closely monitored to determine the future trajectory of WTI prices.

Read More
WTI Holds Steady Near $68.50 Amid US Dollar Strength

WTI surpasses $86.40, eyes on US ISM Services PMI

WTI surpasses $86.40, eyes on US ISM Services PMI

Presently, the price of a particular type of oil known as WTI stands at approximately $86.40 on this Wednesday. It was a bit higher at $88.00 previously, but it has dipped a little since then. The recent surge in the price of WTI can be attributed to the decisions made by two significant countries, namely Saudi Arabia and Russia, who have indicated their intention to reduce their oil production. This announcement has had the effect of driving up the price of WTI in recent weeks.

Both Saudi Arabia and Russia are major players in the global oil market. They produce a lot of oil and sell it to various countries around the world. These countries have now stated that they will continue to decrease the amount of oil they produce until the end of 2023. This news caused the price of WTI to increase significantly over the past few weeks. However, it’s important to note that Saudi Arabia will still be producing around 9 million barrels of oil each day in the coming months. They will review this decision every month to determine whether they should produce more or less oil.

However, there is a factor that has prevented the price of WTI from rising too steeply. The economic data coming from China has not been very favorable. In August, businesses in China that provide services like car maintenance or house cleaning did not experience significant growth. In fact, their growth was the slowest in eight months, according to a report by a company called Caixin. This is noteworthy because China happens to be the largest buyer of oil in the world.

Looking ahead, traders are eagerly anticipating the release of two important reports. One is called the US ISM Services PMI, and the other is the EIA Crude Oil Stocks Change for the week ending September 1. These reports will provide more insights into the current oil supply and the health of the services sector in the United States. Since the price of WTI is denominated in US dollars, this information holds significant importance for those who trade in the oil market. They will be paying close attention to these reports to gain insights and potentially make decisions about buying or selling oil based on the information they contain.

 

Read More
WTI Nears $73.00 Amidst Rising Tensions

WTI Hovers Below $80 as China Growth Concerns and US Rate Hike Fears Persist

WTI Hovers Below $80 as China Growth Concerns and US Rate Hike Fears Persist

As the trading week unfolds, the Western Texas Intermediate (WTI) crude oil benchmark finds itself hovering around the $79.85 mark on Tuesday, revealing a minor upward shift following a pullback from the $80.68 level. The oil market remains ensnared in the grip of investor concerns revolving around the trajectory of China’s economic growth and the looming specter of potential interest rate hikes in the United States, both of which have the potential to impede oil demand and sway WTI prices.

A key driver in the unfolding narrative is the Federal Reserve’s resolute stance on prospective rate hikes, a factor exacerbating uncertainties that play into the undulating path of WTI prices. The recent remarks by Federal Reserve Chairman Jerome Powell have reverberated through the market, underscoring the central bank’s readiness to ratchet up interest rates if deemed expedient. Powell’s announcement underscores that any forthcoming rate determinations will be tethered to empirical data. Moreover, Powell accentuated the landscape of robust economic expansion and a labor market characterized by taut conditions, signaling the possibility of a prolonged cycle of tightening measures. However, this trajectory could potentially fetter the upward thrust of WTI prices, given the domino effect of heightened interest rates on escalating borrowing costs, sluggish economic growth, and a consequential dampening of oil demand.

The unfolding scenario is further compounded by mounting unease regarding China’s economic deceleration, a factor assuming particular significance due to China’s stature as a premier global oil importer. The focal point for many observers is the imminent release of China’s Caixin Manufacturing Purchasing Managers’ Index (PMI) data for August. An underwhelming outcome in this report could likely exert downward pressure on WTI prices, given China’s pivotal role in global oil dynamics.

Concurrently, a counterbalancing influence on the oil market emerges through the prism of supply dynamics. Notably, voluntary production curtailments orchestrated by Saudi Arabia and Russia inject support into the equation. Saudi Arabia’s pronouncement to sustain September production at an approximate rate of 9 million barrels per day, representing a reduction of roughly 1 million barrels from August levels, has the potential to wield a stabilizing impact on prices.

Looking forward, the oil market landscape becomes punctuated by key impending events. One noteworthy juncture is the impending release of China’s Caixin Manufacturing PMI for August, scheduled to be unveiled on the ensuing Friday. Market projections anticipate a modest rise in the index from 49.2 to 49.3, indicating a potentially delicate economic balance. However, the zenith of this week’s developments hinges on the unveiling of the Nonfarm Payrolls (NFP) data, also slated for release on Friday. These events emerge as pivotal inflection points with the capability to markedly sway USD-denominated WTI prices. In light of this, astute oil traders are poised to intently parse through these data releases, harnessing insights to strategically navigate trading opportunities linked to the oscillations in WTI prices.

 

Read More

WTI Holds Near $78.60 Amid US Inflation and China Economic Worries

WTI Holds Near $78.60 Amid US Inflation and China Economic Worries

Today, the price of Western Texas Intermediate (WTI), the key US crude oil benchmark, is holding steady around the $78.60 level. This marks the fourth consecutive day of negative trading as two main factors weighing on the market.

First, there are growing concerns about the potential tightening of monetary policy by the Federal Reserve. The US Energy Information Administration (EIA) reported a significant drop of nearly 6 million barrels in crude oil inventories for the week ending August 11, surpassing expectations of a 2.3 million barrel contraction. Despite this decline, crude oil production has been rising since the initial impact of the pandemic, indicating a steady recovery in demand.

However, the recently released minutes from the Federal Open Market Committee (FOMC) meeting highlighted persistent high inflation. Fed officials are acknowledging significant inflation risks that may require further monetary tightening to align inflation with long-term targets. This hawkish stance is capping the upward movement of WTI prices, as higher interest rates can dampen economic activity and oil demand due to increased borrowing costs.

Another cause for concern is the state of China’s economy. Data shows a decline in the Chinese House Price Index for July, raising alarm bells about a potential property crisis. This concern is amplified by the struggles of major developer Country Garden Holdings in meeting debt obligations. Additionally, Chinese Retail Sales and Industrial Production for July fell short of expectations, indicating further economic distress in China that could put downward pressure on oil prices.

On a positive note, the tightening supply dynamics could exert upward pressure on WTI prices. Saudi Arabia has announced an extension of its voluntary oil output cut of one million barrels per day through September. Similarly, Russia is planning to decrease its oil exports by 300,000 barrels per day in September. Recent reports suggest that Saudi Arabia’s oil exports have reached their lowest level since September 2021, dipping below 7 million barrels per day.

Looking ahead, oil traders will closely monitor US weekly Initial Jobless Claims and the Philadelphia Fed Manufacturing Survey for August, as well as ongoing developments in China’s economic landscape. These factors will significantly influence the price of WTI, guiding trading strategies in response to evolving market conditions.

Read More

WTI Holds Firm Above $82: China’s Issues and US Retail Sales in Focus

WTI Holds Firm Above $82: China’s Issues and US Retail Sales in Focus

The Western Texas Intermediate (WTI) crude oil price has maintained its position above the $82 mark on the trading landscape, with two major factors shaping its trajectory: concerns over China’s economic challenges and anticipation of US retail sales data.

Amid the economic turmoil caused by the Chinese real estate sector, investors are closely monitoring how these developments might affect global markets. Specifically, Country Garden Holdings Co.’s bond and share price declines have raised alarms, triggering concerns of potential significant defaults within the sector. The broader implications of China’s real estate market instability are magnifying the impact on the WTI price.

Adding to these concerns, China’s recent inflation data has sparked further unease. The Consumer Price Index (CPI) for July exhibited deflationary signs, showing a year-on-year decrease of 0.3%. Given that China is one of the world’s largest oil consumers, any economic shifts in the country have direct consequences on global oil demand and prices.

In contrast to these concerns, supply-side factors are exerting their influence. Saudi Arabia’s decision to extend its voluntary oil output cut of one million barrels per day (bpd) through September suggests a tightening of supply. Additionally, Russia’s plans to reduce its oil exports by 300,000 bpd in September adds to the support for higher WTI prices.

Both the Organization of Petroleum Exporting Countries (OPEC) and the Energy Information Administration (EIA) have displayed optimism for the second half of the year. The IEA projects a demand increase of 2.2 million bpd in 2023, driven by factors like increased air travel, growing oil demand in power generation, and elevated petrochemical activity in China. OPEC, on the other hand, anticipates a production increase of 2.44 million bpd.

In the coming days, the focus will shift to key data releases. The attention of oil traders will be directed towards US Retail Sales figures for July, with expectations of a rise from 0.2% to 0.4%. Additionally, the upcoming releases of the American Petroleum Institute’s (API) Weekly Crude Oil Stock report and the Energy Information Administration’s (EIA) Crude Oil Stocks for the week ending August 11 will provide further insight into market dynamics. These data points will play a vital role in guiding oil traders as they analyze opportunities related to the USD-denominated WTI price.

Read More

WTI Crude Oil Steadies Around $82.30 Ahead of EIA Report and US Inflation Figures

WTI Crude Oil Steadies Around $82.30 Ahead of EIA Report and US Inflation Figures

In the early European session on Wednesday, WTI, the benchmark for US crude oil, is exhibiting little movement as prices fluctuate within a narrow range of $82.20 to $82.45. The market is grappling with concerns over China’s dwindling demand for oil due to trade dynamics and inflation patterns, which are exerting downward pressure on WTI prices.

The release of Chinese inflation data for July reveals a year-on-year decrease of 0.3% in the Consumer Price Index (CPI), deviating from the previous reading of 0%. Surpassing market expectations of a decline of -0.4%, this slight improvement is encouraging news. Furthermore, the Producer Price Index (PPI) experienced a year-on-year decrease of 4.4%, surpassing the anticipated drop of 4.1%.

A significant decline of 18.8% in China’s crude oil imports during July is particularly noteworthy, marking the lowest level since January. This decline is worrisome considering that China stands as the world’s largest consumer of oil.

Conversely, the latest report from the US Energy Information Administration (EIA) provides some support for WTI prices. The EIA projects a 1.9% increase in Gross Domestic Product (GDP) for 2023, an improvement from the previous forecast of 1.5%. According to the report, the recent surge in crude prices can be attributed to Saudi Arabia’s voluntary output restrictions and the growing global demand for oil.

WTI prices have received an additional boost from Saudi Arabia’s decision to extend its one-million-barrel-per-day oil output cut until September, along with Russia’s plan to reduce oil exports by 300,000 bpd in September.

Traders are anxiously awaiting the release of the EIA Crude Oil Stocks Change report on Wednesday, covering the week ending August 4. Furthermore, they have their eyes set on key events such as the release of the Consumer Price Index (CPI) and the Producer Price Index (PPI) later this week. The analysis of this data will be crucial for traders as it has the potential to significantly impact the value of USD-denominated WTI, creating trading opportunities in the oil market.

Read More
Japan's Land Prices Rise at Fastest Pace Since

Japan’s Land Prices Rise at Fastest Pace Since 2010, Tax Agency Reports

Japan’s Land Prices Rise at Fastest Pace Since 2010, Tax Agency Reports

In 2023, Japan’s land prices experienced their fastest rise since comparable data became available in 2010, as reported by the National Tax Agency on Monday. This increase highlights a robust recovery, driven in part by a resurgence in tourism following the coronavirus pandemic.

Average land prices climbed by 2.3% last year, marking the third consecutive year of growth. This follows a 1.5% increase in 2022 and a 0.5% rise in 2021. The survey showed that land prices increased in 29 out of 47 prefectures, including Tokyo, Hokkaido, and Okinawa. This was an improvement from the previous year when prices rose in 25 prefectures. Conversely, land prices fell in 16 prefectures, down from 20 in 2022.

The demand for both residential and commercial land remained strong, with Fukuoka prefecture experiencing the highest increase at 5.8%. This surge was supported by redevelopment projects that boosted office demand and a revival in tourism that enhanced the demand for hotels and restaurants.

In Tokyo, the return of foreign visitors helped maintain a plot in the upscale Ginza shopping area as the most expensive location in Japan for the 39th consecutive year. The price of this plot increased by 3.6% in 2023, reaching 44.2 million yen ($274,705) per square meter, marking two consecutive years of price growth.

The surge in inbound tourism also played a significant role in this trend. Japan saw over 3 million visitors for the third straight month in May, benefiting from a weak yen that made travel more attractive. In 2022, Japan welcomed approximately 25 million foreign visitors, a notable recovery compared to the record 31.9 million in 2019.

The National Tax Agency evaluates land prices as of January 1 each year to determine inheritance and gift taxes on properties acquired during that year. This annual assessment is crucial for understanding the dynamics of the real estate market and its impact on taxation policies.

Read More

Debate Highlights: Biden Struggles Against Trump on Economy

Debate Highlights: Biden Struggles Against Trump on Economy

During the recent presidential debate, President Joe Biden struggled to demonstrate his readiness for a second term, faltering against former President Donald Trump. The debate was controlled and policy-focused, contrasting the 2020 debates’ outbursts and testy exchanges.

Biden’s performance raised concerns about his age and mental acuity, with his hoarse voice, halting responses, and confusion over key data points. Even his prepared closing remarks were marred by stumbles and incoherence. In contrast, Trump appeared confident and robust. Biden’s allies attributed his performance to a cold, attempting to downplay its impact.

Trump maintained a mostly calm demeanor, avoiding the outbursts that previously hurt him and refraining from giving Democrats ammunition to label him as extreme. Although he still used his characteristic exaggerations and superlatives, his behavior was notably restrained compared to past debates.

Biden defended his economic record, highlighting efforts to help Black families with unemployment, housing discrimination, and student loans. However, he acknowledged ongoing inflation issues, which polls indicate are driving Black voters toward Trump—a critical demographic for Biden’s 2020 victory.

The candidates blamed each other for potential economic hardships if elected. Trump claimed Biden would raise taxes on families, while Biden warned that Trump’s tariff plans would increase costs for households. Biden has pledged not to raise taxes on those earning less than $400,000, while Trump proposes a 10% tariff on all goods, potentially costing households $1,700 annually according to the Peterson Institute for International Economics.

On abortion, Trump presented a moderate stance, taking credit for overturning Roe v. Wade but stating he would not ban the abortion drug mifepristone and supported exceptions for rape, incest, and the life of the mother. He accused Democrats of supporting late-term abortions and infanticide, which Biden firmly denied, stating, “We are not for late-term abortion period. Period. Period.”

The debate also saw Trump accuse China of exacerbating the US opioid crisis and bringing the country closer to a global conflict. He warned that China would dominate the US if current policies continued. Following the debate, the dollar inched higher in Asian trading as markets assessed Trump as having the upper hand.

Read More

Yen Set for Major Swings Amid Intervention Threat, Charts Indicate

Yen Set for Major Swings Amid Intervention Threat, Charts Indicate

The market is bracing for a significant increase in yen volatility as the currency slumps to its lowest level since 1986, raising concerns about potential Japanese intervention. Volatility spreads reveal that investors are demanding a premium to guard against sudden moves, bearish yen bets are accumulating, and active trader positioning is at its most negative since 2022.

Despite warnings from Japanese authorities, the yen continues to weaken, increasing the likelihood of market intervention. Japan’s top currency official, Masato Kanda, has stated that the nation is prepared to intervene 24 hours a day if necessary.

Three key charts highlight the pressure on the yen. First, while implied volatility in the yen seems subdued, its spread over fluctuations in other currencies remains above the average since early 2021. This indicates heightened concern among investors about sudden movements in the yen compared to other major currencies.

Second, hedge funds and asset managers held bearish yen positions worth approximately $14 billion as of June 18, according to the latest Commodity Futures Trading Commission data. This figure surpasses bearish bets on other major currencies and contrasts with euro net longs worth $32.7 billion. The large bearish positions reflect a strong consensus against the yen among institutional investors.

Third, a Citigroup gauge of active trader positioning in the yen has dropped to its most negative level since 2022, following a surge in short bets. This indicates that traders remain firmly bearish on the yen but also suggests that many positions may need to be quickly unwound if the currency suddenly strengthens, potentially leading to rapid market movements.

The impact of the ¥9.8 trillion ($62 billion) Japan spent on foreign exchange intervention earlier this year has already diminished. Individual investors are now anticipating another opportunity to sell the yen if the currency appreciates following a new round of intervention. This sentiment was echoed by Hideki Shibata, a senior strategist at Tokai Tokyo Intelligence Lab, who noted that the market is closely watching for any signs of intervention that could trigger significant trading activity.

In summary, the yen is poised for substantial volatility, driven by persistent weakness and the looming threat of intervention. Investors are preparing for potential sharp movements, reflecting heightened uncertainty and strategic positioning in the currency markets.

Read More
Economists Boost China Growth Forecasts

Economists Boost China Growth Forecasts Amid Improved Exports

Economists Boost China Growth Forecasts Amid Improved Exports

The outlook for China’s exports is expected to improve, supporting growth in the world’s second-largest economy even as consumer spending slows, according to a Bloomberg survey of economists.

Exports are forecasted to rise by 4.3% this year, up from a 2.8% gain predicted in May, based on the median forecast of 22 economists surveyed between June 17-24. China’s economy is projected to expand by 5%, an increase from the 4.9% forecasted in May, according to the median of 68 estimates.

China’s exports exceeded expectations in April and May, driven by strong overseas demand and the competitiveness of Chinese producers. This aligns with Beijing’s strategy of relying on exports to fuel growth and offset weak domestic spending. However, risks are increasing as Chinese companies face more trade barriers from the US and Europe.

These survey results contrast with a recent report from Goldman Sachs, which noted skepticism among its clients in China about the sustainability of export growth in the coming quarters. Investors are concerned about the sustainability of supply-side expansion amid weak domestic demand and rising trade frictions.

Economists have reduced their expectations for retail sales growth and consumer and factory-gate price inflation this year, reflecting pessimism over demand as the housing market continues to contract. Recent macroeconomic data indicate that the property sector remains a significant drag on the economy. Growth is still supported by stronger export momentum, but external risks are rising as China’s overcapacity leads to trade disputes, particularly with the US and Europe.

Deflationary pressures are likely to persist in China this year, with economists becoming more pessimistic about prospects. They expect the consumer price index to rise by only 0.6% this year, while the producer price index is forecasted to drop by 1%, both weakening from the estimates in May. This reflects consumers’ reluctance to spend amid concerns about job security, income prospects, and falling property values.

Economists have postponed their expectations for a cut to the reserve requirement ratio to the third quarter from the second quarter. The People’s Bank of China (PBOC) has held off on easing in recent months to protect the yuan and due to ample market liquidity. They also project slower money supply growth this year compared to May, as the central bank focuses on the efficiency of funds rather than pure expansion.

Projections for policy interest rates and the loan prime rate cuts remain set for the third quarter.

Read More
Chinese Economy Poised for Growth Despite Challenges

Chinese Economy Poised for Growth Despite Challenges

Chinese Economy Poised for Growth Despite Challenges

China’s economy is set to continue its growth trajectory this year, bolstered by significant untapped potential in rural consumption, manufacturing, and further economic liberalization, as reported by the World Economic Forum.

Chen Liming, chair of Greater China at the WEF, highlighted China’s enduring strengths such as its vast market size, rich talent pool, and robust, complete industrial chain. These factors contribute to the nation’s long-term positive economic outlook.

China’s consumer market remains large, with substantial growth opportunities in regional and rural development. The country’s production and manufacturing systems are also undergoing continuous upgrades, driving further economic expansion.

According to data from the National Bureau of Statistics, China’s retail sales, a crucial indicator of consumer spending, increased by 3.7 percent year-on-year in May, and industrial output saw a 5.6 percent rise during the same period.

Chen’s comments come in advance of the 15th World Economic Forum Annual Meeting of the New Champions, also known as the Summer Davos Forum, which is scheduled to take place in Dalian, Liaoning province.

Chen advocated for the maintenance of stable, transparent, and predictable policies to bolster national growth stability and boost business confidence, thereby strengthening vertical industry momentum.

He emphasized the importance of China’s continued reforms and openness, which are vital for maintaining a competitive and equitable business environment. He noted that Dalian and Liaoning province have become attractive destinations for foreign investment due to improved business conditions and a more international, law-compliant environment.

The Summer Davos Forum has also enhanced Liaoning’s interaction with the global community, offering a platform to display technological advancements and economic achievements, thus aiding the province’s economic internationalization.

Despite facing recent protectionist actions from major trading partners, such as additional duties on Chinese-made electric vehicles by the European Commission and the U.S. targeting China’s emerging industries with tax increases, China remains committed to resolving trade issues through dialogue rather than sanctions.

Chen remarked that competitive disparities between countries often stem from variations in resources, technology levels, and workforce skills, rather than the production capacities often cited by critics.

Read More
Japan's Demand-Driven Inflation Slows

Japan’s Demand-Driven Inflation Slows, Obscuring BOJ Rate Hike Outlook

Japan’s Demand-Driven Inflation Slows, Obscuring BOJ Rate Hike Outlook

Japan’s core inflation saw an uptick in May due to increased energy levies, but an index that removes the impact of fuel continued to decline for the ninth consecutive month, as shown in data released on Friday. This trend complicates the central bank’s decision on the timing of interest rate hikes.

The continued slowdown in “core core” inflation, which the Bank of Japan (BOJ) closely monitors as a crucial indicator of demand-driven price changes, casts doubt on the bank’s belief that rising wages will support consumption and maintain inflation on track to sustainably hit its 2% target.

The core consumer price index (CPI), which excludes volatile fresh food prices, increased by 2.5% in May compared to a year earlier, up from the previous month’s 2.2% gain. This rise was primarily due to a hike in the renewable energy levy and was close to the median market forecast of a 2.6% gain. However, inflation measured by an index excluding both fresh food and fuel slowed to 2.1% in May from 2.4% in April, marking the lowest year-on-year increase since September 2022.

Private-sector service inflation also slowed to 2.2% in May from 2.4% in the previous month, indicating that companies remain hesitant to pass on labor costs to consumers. This trend suggests that the anticipated boost to services inflation from strong pay hikes agreed upon in this year’s spring wage negotiations has not yet materialized.

The outlook for inflation is further complicated by a renewed rise in crude oil prices and increased import costs due to a weak yen. Analysts predict that core CPI could accelerate to nearly 3% later this month because of rising raw material costs. However, such pressure could negatively impact consumption and deter companies from raising prices, which would hamper the BOJ’s efforts to sustain underlying, demand-driven inflation around its 2% target.

Real wage growth in Japan remains weak, and there is no substantial data confirming that demand-driven inflation is accelerating. As a result, it is unlikely that the BOJ will raise rates before October-December this year.

The BOJ ended negative rates and bond yield control in March, marking a significant shift from its decade-long radical stimulus program. With inflation surpassing its 2% target for two years, the BOJ has hinted at raising short-term rates to levels that stabilize the economy, which analysts estimate to be between 1-2%. Many economists anticipate that the BOJ will increase interest rates to 0.25% this year, though opinions are divided on whether this will happen in July or later in the year.

Read More

China’s Yuan Softens Versus Dollar Amid Growing Yield Gap

China’s Yuan Softens Versus Dollar Amid Growing Yield Gap

The Chinese yuan weakened against the U.S. dollar, influenced by an increasing yield differential and diverging monetary policies from the U.S. Federal Reserve and the People’s Bank of China (PBOC), posing challenges for the currency. Since December 27, the spread between yields on China’s 10-year government bonds and U.S. equivalents has grown by 24 basis points to 144 basis points. Market adjustments reflect anticipation of the Fed’s less aggressive policy stance and the likelihood of rate cuts by the PBOC.

On the same day, yields on China’s 10-year government bonds dipped to their lowest since April 2020, reflecting the impact of policy differences on the yuan, particularly in offshore markets. The PBOC’s balance sheet actions, including expectations of reduced interest rates and loan enhancements via the pledged supplementary lending program, are seen as efforts to provide relief, particularly to the property sector. This is evident from the PBOC’s 350 billion yuan injection into policy banks in December to bolster the housing market.

Traders have noted unusually high U.S. dollar reserves held by onshore exporters, which are anticipated to be converted into yuan as the Lunar New Year approaches, potentially strengthening the yuan against the dollar towards late January or early February.

The PBOC set the yuan’s daily reference rate at 7.1029 per dollar, slightly weaker than the previous day’s fix of 7.0997. The spot yuan rate opened at 7.1675 per dollar and stood at 7.1684 midday, marking a slight depreciation from the last session’s close. Meanwhile, the global dollar index edged up slightly to 102.457 from 102.422.

The currency markets are also eyeing the upcoming U.S. payroll data, which is expected to provide further insight into the Fed’s future policy decisions and could influence the yuan-dollar exchange rate. The offshore yuan was observed trading at a weaker level compared to the onshore rate, at 7.1783 per dollar.

Read More
Australian Dollar Steadies Above

Australian Dollar Steadies Above Key Mark Before US PMI, FOMC Minutes

Australian Dollar Steadies Above Key Mark Before US PMI, FOMC Minutes

The Australian Dollar (AUD) is navigating choppy waters, managing to hold above the crucial 0.6750 threshold against the US Dollar (USD). The AUD, tied closely to commodity markets, is under pressure from a global growth slowdown at 2024’s end, nudging investors towards the USD. Despite this, speculation over imminent Federal Reserve rate cuts has been tempered, with unexpected upbeat manufacturing data from China offering some support to the AUD.

Amidst this backdrop, Australia’s own economic indicators are closely watched, with the Reserve Bank of Australia (RBA) emphasizing the importance of data review in rate-setting deliberations. A recent dip in the Judo Bank Manufacturing PMI suggests an easing in economic activity, and upcoming Composite and Services PMI figures are expected to reflect similar trends, potentially signaling sectoral shrinkage.

Despite these challenges, the AUD’s footing might remain firm, underpinned by persistent domestic inflation and a buoyant housing market. Expectations are tilting towards the RBA holding back on policy tightening at its February session, which could lend support to the currency.

Revelations from RBA’s internal documents suggest that rising interest rates have begun to weigh on Australian households and businesses, evidenced by a downturn in domestic tourism and a consumer shift towards more budget-friendly goods to mitigate living costs. Yet, a silver lining appears in the form of stable private sector wage growth, hovering around 4%, offering a glimpse into the country’s economic condition.

In a move to ease the cost-of-living strain without stoking inflation, Australian Prime Minister Anthony Albanese has tasked the Treasury and Finance departments to seek viable relief strategies for families.

Geopolitical undercurrents also play a role, with China’s framing of the January 13 elections in Taiwan as a pivotal decision with far-reaching implications, adding to regional tensions that could influence the AUD/USD dynamic.

Meanwhile, the US Dollar’s trajectory is upward, bolstered by higher Treasury yields, despite a S&P Global Manufacturing PMI that fell short of forecasts. Investors are now turning their attention to upcoming US data, including the December ISM Manufacturing PMI and the FOMC Minutes.

These minutes, released in the wake of Federal Reserve Chair Jerome Powell’s hints at possible rate reductions, are anticipated to provide further insight into the Fed’s monetary stance, potentially impacting the AUD and broader currency markets.

 

Read More

Iran and Russia to Conduct Trade Using Own Currencies, Bypassing US Dollar – Reports by State Media

Iran and Russia to Conduct Trade Using Own Currencies, Bypassing US Dollar – Reports by State Media

Iran and Russia have reached a significant milestone in their economic partnership by agreeing to conduct trade transactions using their respective local currencies, thereby sidelining the US dollar. This strategic move, confirmed by Iranian state media, was solidified during discussions held by the central bank chiefs of both nations in Russia.

The shift to local currencies comes as both countries face stringent US sanctions, prompting them to seek alternative financial mechanisms for their trading operations. By establishing a system that operates outside of the conventional SWIFT interbank network, they have created a pathway to facilitate trade without reliance on the US dollar.

The timing of this agreement aligns with the strengthening of ties within the Russian-led Eurasian Economic Union (EEU), which recently incorporated Iran into its fold through a comprehensive free trade agreement signed on December 25. This inclusion into the EEU is a strategic gain for Iran, broadening its economic horizons and reinforcing its trade potential within the region.

For Russia, Iran’s partnership has grown increasingly vital following the imposition of Western sanctions due to the ongoing conflict in Ukraine. These sanctions have heavily restricted Russia’s access to traditional foreign trade markets, particularly in Europe, propelling it to seek and develop alternative trade routes and partners.

The deepening of Iran-Russia relations is not confined to economic aspects alone but extends into military cooperation. In November, Iran announced the finalization of deals with Russia that would enhance its military capabilities, including the acquisition of advanced Su-35 fighter jets, Mi-28 attack helicopters, and training for pilots on the Yak-130 aircraft. This move signifies a mutual interest in not only bolstering their economies but also in strengthening strategic and defense collaborations in the face of geopolitical pressures.

This realignment of trade and military alliances by Iran and Russia represents a significant pivot away from Western-dominated financial systems and defense dependencies. By forging their own paths and utilizing local currencies for trade, both countries are sending a clear signal of their intent to operate independently of the influence exerted by the US dollar and to resist the limitations imposed by sanctions.

 

Read More
Japanese Yen Nears Multi-Month

Japanese Yen Reaches New Daily High Versus USD, BoJ Stance May Limit Rise

Japanese Yen Reaches New Daily High Versus USD, BoJ Stance May Limit Rise

On Wednesday, the Japanese Yen (JPY) exhibited a notable upswing, securing a new daily zenith against the US Dollar (USD), in a modest comeback from its substantial depreciation observed in the preceding three days. During the early European trading hours, the USD/JPY currency pair was seen dipping to a daily low, hovering around the 143.30 mark. Despite this upward movement, the sentiment among Yen bulls remains cautious. This tentativeness stems from the Bank of Japan’s (BoJ) recent reaffirmation of its commitment to maintain expansive monetary policy settings. In its latest policy meeting on Tuesday, the BoJ held firm on its existing stance, maintaining its accommodative policy guidance and thereby moderating some investor anticipation of a potential pivot towards less negative interest rates.

This week also brought to light a decline in Japan’s trade activity, with imports and exports falling more significantly than anticipated in November. The decrease in trade volumes, coupled with a generally optimistic atmosphere in global equity markets, has somewhat diminished the Yen’s allure as a safe-haven asset. Conversely, the US Dollar found some support, buoyed by the market’s speculation about the Federal Reserve’s (Fed) interest rate trajectory. The uncertainty surrounding when and how the Fed might commence scaling back its interest rates has provided some backing to the USD/JPY pair.

Traders, for now, seem to be holding back from making bold directional moves with the Yen, opting for a more measured approach as they await an important inflation update from the United States. The upcoming release of the US Core Personal Consumption Expenditure (PCE) Price Index, the Fed’s preferred measure of inflation, is highly anticipated this Friday. The outcomes of this report are expected to significantly influence the Fed’s future policy decisions, which, in turn, will have implications for USD demand and potentially inject new momentum into the USD/JPY exchange dynamics.

In the interim, several economic indicators and events are poised to sway short-term trading strategies. These include the release of the Conference Board’s Consumer Confidence Index and data on Existing Home Sales. Moreover, market participants are likely to pay close attention to Chicago Fed President Austan Goolsbee’s remarks, seeking insights that could offer trading cues during the North American market session on Wednesday.

The confluence of these domestic and international economic developments will continue to shape the narrative around the USD/JPY pair, as investors and traders calibrate their positions in response to evolving monetary policy expectations and the broader economic outlook.

Read More
China's Yuan Softens Versus Dollar Amid Growing Yield Gap

China’s Central Bank Restarts 14-Day Reverse Repos to Ease Year-End Liquidity

China’s Central Bank Restarts 14-Day Reverse Repos to Ease Year-End Liquidity

After a three-month hiatus, the People’s Bank of China (PBOC) has recommenced its practice of injecting short-term cash into the financial system via 14-day reverse repurchase agreements (reverse repos). This move, enacted on Monday, is part of a broader strategy to manage the surging liquidity requirements typically seen as the year draws to a close.

Reverse repos are financial instruments used by central banks to control the money supply. By selling securities with the agreement to repurchase them at a later date, central banks can temporarily decrease the amount of money circulating in the economy. The PBOC’s latest round of injections funneled a substantial 244 billion yuan (equivalent to approximately $34.28 billion) into the market through these operations. This capital injection was divided into two segments: a majority of 184 billion yuan was allocated to the seven-day tenor—standard short-term loans—and the remaining 60 billion yuan was directed towards the 14-day tenor.

This recent allocation marks the first instance since late September that the 14-day reverse repo contracts have been employed by the PBOC. These longer tenor agreements are indicative of the central bank’s intent to provide a more sustained source of funds, ensuring that financial institutions have adequate cash for a longer period.

The PBOC’s actions reflect its commitment to maintaining a stable financial environment, a necessity for economic growth and stability. The bank’s official statement on Monday underscored this objective, indicating that the operation was specifically designed to preserve “reasonably ample” liquidity conditions as the year-end approaches. Maintaining such liquidity is crucial for the smooth operation of financial markets, as it enables banks to fulfill withdrawal requests, grant loans, and support economic activity without undue stress.

In broader economic terms, these measures are closely watched by market participants as they often signal the central bank’s monetary policy stance and outlook on the economy. The PBOC’s decision to resume 14-day reverse repos could thus be interpreted as a proactive step to pre-empt potential cash shortages, stabilize money market rates, and guide market expectations during periods of seasonal cash demand.

Read More

UK Consumer Sentiment Hits Near Two-Year Peak

UK Consumer Sentiment Hits Near Two-Year Peak

In the closing month of the year, the UK’s consumer confidence has shown a slight uptick, indicating a modest shift in public sentiment despite ongoing economic challenges. In December, analysis from market research firm GfK Ltd. identified a rise in consumer sentiment, marking the highest point since the beginning of the year, although the mood among UK households remains cautious.

The GfK’s sentiment indicator, which increased by two points to minus 22, suggests that while consumers are still grappling with uncertainty, there is a nascent optimism brewing about the economy’s direction as we head into 2024. This increment is the most significant since January of the previous year, signaling that consumers are starting to see a silver lining despite the overarching pessimism reflected in the negative reading. 

This budding optimism encompasses several aspects of the GfK’s survey, which captures feelings towards personal finances, general economic conditions, major purchase intentions, and saving behavior. The data suggests that even amid the current cost-of-living crisis, which continues to exert pressure on the majority of households, there’s a gradual but steady shift toward a more positive outlook on personal financial prospects for the forthcoming year.

Further affirming this shift in consumer confidence is data from the Recruitment and Employment Confederation (REC), which points to a sustained high number of job vacancies within the UK economy. The REC’s metrics showed a 7.7% increase in job postings, totaling 1.44 million in the week starting November 27. This figure is slightly lower by 8.6% compared to the same period in the previous year, yet it underscores a resilient job market. 

The week in question saw the advertisement of 186,329 new job positions, only a 2.6% drop year-on-year, with certain sectors such as physiotherapy, midwifery, and occupational therapy witnessing notable surges in job adverts. Interestingly, no region in the UK experienced a reduction in job advertisements from the preceding week, which suggests a broad-based demand for labor across the country.

The resilience of the job market can be attributed to the ongoing labor shortages and the skills gap that the UK is experiencing. According to REC’s Chief Executive Neil Carberry, the slower economy has not led to a significant reduction in hiring as might be expected in a typical economic downturn. Instead, sectors such as hospitality, engineering, healthcare, and social care continue to face hiring challenges, further complicated by the scarcity of labor and specific skill sets.

This situation presents both an obstacle and an opportunity. The difficulty in filling roles across various sectors could potentially lead to wage growth as employers strive to attract scarce talent. This, in turn, could influence consumer spending and sentiment positively. As the UK navigates the uncertain terrain of post-pandemic recovery, the interplay between job market dynamics and consumer confidence will be critical to watch, with implications for economic policy and business strategies in the coming year.

Read More

Japan Approves Tax Reductions to Aid Families, Combat Deflation

Japan Approves Tax Reductions to Aid Families, Combat Deflation

In Japan, the government’s tax reform committee, part of the ruling Liberal Democratic Party, has reached a consensus on reducing income tax rates. This move is designed to alleviate the financial strain on households amidst the rising costs of living, signaling a shift from the longstanding deflationary period that has characterized the Japanese economy.

Prime Minister Fumio Kishida, confronting dwindling public approval due to inflation, stagnant wages, and political fundraising controversies, has chosen to emphasize these tax cuts as a cornerstone of his administration’s growth-centric policies.

In a strategic pivot, the tax reform committee has set an upper limit on the annual income eligible for these tax reductions, targeting relief efforts towards middle and lower-income brackets and addressing the widening economic disparity.

The proposal includes deferring an increase in taxes originally intended to augment defense spending in the subsequent fiscal year. This delay reflects the government’s prioritization of economic support for citizens over military expenditure amid current fiscal considerations.

Further, the committee has decided not to proceed with a planned reduction in the cap on mortgage borrowing for the upcoming year, providing continued access to housing loans for families.

In an effort to stimulate economic expansion through private consumption, the government is also extending tax incentives to businesses that increase employee wages. This policy is extended to small businesses in deficit, allowing them to benefit from preferential tax treatment for a duration of five years.

The tax panel is introducing a novel tax scheme to encourage domestic investment, particularly in companies that produce essential materials for decarbonization and economic security. This initiative will offer tax incentives for ten years, aiming to boost sectors such as electric vehicles and advanced technology components, which are crucial for Japan’s strategic economic initiatives.

These tax incentives are part of a broader government strategy to foster a conducive environment for substantial investments in key industries, particularly those aligned with Japan’s green transformation goals.

The details of these tax reforms are to be incorporated into the fiscal 2024 tax reform framework, which was finalized on Thursday. This framework is anticipated to lay the groundwork for a resilient and forward-looking Japanese economy.

Read More
US Yields Boost Dollar, Weaken Yen

US Yields Boost Dollar, Weaken Yen

US Yields Boost Dollar, Weaken Yen

The dollar strengthened on Tuesday, driven by rising U.S. yields, putting pressure on low-yielding currencies like China’s yuan and Japan’s yen, which fell to its lowest level since 1986.

Benchmark 10-year Treasury yields increased nearly 14 basis points to 4.479% overnight. Analysts attributed this rise to expectations of Donald Trump winning the U.S. presidency, which could lead to higher tariffs and increased government borrowing.

As the dollar gained, the euro reversed part of a small rally following the first round of France’s election, which aligned with polling predictions. The euro last traded at $1.0735.

The yen dropped to 161.72 per dollar on Monday, its weakest in nearly 38 years, primarily due to the significant interest rate gap between the U.S. and Japan. On Tuesday, the yen traded at 161.55 per dollar in Asia and was under pressure from yen bears wary of potential intervention by Japanese authorities. The yen also hit a lifetime low of 173.67 against the euro on Monday and remained near that level on Tuesday.

In the bond market, the 10-year yield gap between U.S. and Japanese rates stood at 340 basis points, and nearly 440 basis points at the two-year tenor. China’s yuan, which reached a seven-month low against the dollar last week, faced similar pressure, with U.S. 10-year yields more than 220 basis points higher than Chinese government bond yields.

Robust manufacturing data in China and an announcement from the central bank about borrowing bonds, likely to sell them and stabilize falling yields, provided only a brief boost to the currency on Monday. The yuan last traded at 7.3043 in offshore markets on Tuesday, close to its June low.

The New Zealand dollar slipped 0.3% in early trade and was testing support at its 200-day moving average at $0.6075. The British pound remained steady at $1.2641. The Australian dollar hovered within its recent range at $0.6650, with traders focused on central bank minutes to gauge the likelihood of future interest rate hikes. Swaps market pricing suggests a one-in-three chance of a rate hike as soon as next month.

The question remains about the trigger for such a move. ING economist Rob Carnell noted that discussions have taken place, but the specific trigger for a hike is still uncertain. There is a leaning towards forecasting a hike at the August meeting.

Overall, the strengthening dollar and rising U.S. yields continue to exert pressure on low-yielding currencies, with markets closely watching upcoming central bank decisions and geopolitical developments.

Read More

Cryptocurrency Move Back to Support the Pack to Level

If we have a look at the bearish start to the day in the majors and the Bitcoin move back to the level by $18,500 to the support pack. The Bitcoin to USD was seemed down at the level by 1.16% on this Thursday that reversing a 1.25% gain to the Wednesday to the ended the day at the level $18,260.0. At the start of the day, the Bitcoin rose to the early morning intraday to the high at the level before hitting the reverse level.

The major resistance level goes at the level by $18,878 and the Bitcoin fell to the intraday low to the level by $17,935.0.

The close term bullish pattern stayed flawless, disregarding the most recent pullback to sub-$18,000 levels. For the bears, Bitcoin would have to slide through the 62% FIB of $10,095 to shape a close term bearish pattern.

The Bitcoin was somewhere near at the level by 1.03% to $18,072.0. A blended beginning to the day saw Bitcoin ascend to an early morning high of $18,299.0 prior to tumbling to a low of $18,070.0.

Bitcoin left the significant help and obstruction levels untested from the get-go.

Somewhere else, it was a bearish beginning to the day for the majors. The Ripple’s XRP was somewhere around at the level 2.69% to lead the route down.

Read More

Bitcoin Slips Down Below at Level $13,000 Since the Last Rally

Bitcoin Slips Down Below at Level $13,000 Since the Last Rally

The Bitcoin seems to the low at the level of $9,813 in September that managed the bitcoin to reach at the level high at $13,868. The bitcoin price is rejected to the sequential indicators on the 3-day chart.

If we have a look at the current candlestick of the 3-day chart it will seem significantly bearish and the TD sequential indicators are presented a sell signal. The 50- SMA seems down at the level of $10,600 and the 100 SMA at the level of $9,47.

The In/Out of the Money Around Price chart shows the closest and most grounded help region to be somewhere in the range of the level at $12,687 and $13,073 with near 624,000 BTC in volume. A break below this point can drive the cost of Bitcoin down to $11,914.

Despite the fact that bears appear to have assumed responsibility for the present moment, the powerful day by day upswing stays unblemished for Bitcoin. The 50-SMA and the 100-SMA harmonize around $11,200 which will go about as a critical help level. The MACD keeps bullish and the most basic obstruction level is still at $13,863. A breakout over this point can without much of a range drive the lead digital currency towards the untouched high at the level of $20,000.

Read More

Bitcoin Price Clear the Path and Rose to the Level $13,000

Bitcoin Price Clear the Path and Rose to the Level $13,000

Bitcoin Price of the bulls has been the full control of the market to the price at the level of $11,340 to $12,835. The cryptocurrency had the largest to the single day that put the gain. The MACD shows the increasing the bullish momentum to price the growth anticipated.

The position detector is a convenient little apparatus that causes us to imagine solid opposition and backing levels. According to the everyday conjunction detector, there is an absence of solid obstruction levels on the potential gain. This should be empowering news for the buyers as they plan to bring BTC into the $13,000-zone.

Santiment’s holder’s distribution charts show you the number of addresses having a place with a specific symbolic section. According to the chart, the number of addresses holding 10,000-100,000 tokens tumbled from 111 on October 8 to 104 on October 20. This is an intensely bearish sign as it shows that the whales are selling off their property.

Bitcoin buyers have the opportunity to bring the cost into the level at $13,000 and even the $14,000 interference. The everyday intersection finder shows a total absence of solid opposition barriers straightforward.

For the bears, the drawback is covered off at the $12,000-$12,100 uphold divider. A break below that zone will bring the value down to $11,000, which has both the 50-day and 100-day SMA

Read More

Cryptos Market: Bitcoin Shows Bullish Momentum Over Dollar Strength

Cryptos Market: Bitcoin Shows Bullish Momentum Over Dollar Strength

The BTC/USD traded at the level of $11,355 after the mild rejection of the top-level $11,720 that losing some of the bullish.

Ethereum USD had a similar fate at the higher risk that seeing the longer pullback than the Bitcoin. If we talk about the XRP/USD is the clear loser after breaking below the 50 SMA and the 100 SMA on the daily chart that currently trading at the level of $0.2482 after yet facing another rejection.

Bitcoin, BTC to USD, fell by 1.02% on Tuesday. Incompletely turning around a 1.55% increase from Monday, Bitcoin finished the day at the level of $11,442.0.

It was a quiet beginning to the day. Bitcoin rose to a late morning intraday high to the level of $11,574.9 before operating reverse.

Missing the mark concerning the primary significant obstruction level at $11,830, Bitcoin tumbled to an early evening intraday low of $11,333.0.

Avoiding the primary significant help level at $11,201 Bitcoin quickly returned to $11,470 levels before moving back.

The close term bullish pattern stayed perfect, upheld by the most recent move back through to $11,000 levels. For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to shape a close term bearish pattern.

Bitcoin was up by 0.22% to $11,467.0. A beginning to the day saw Bitcoin tumble to an early morning low of $11,427.0 before ascending to a high at the level of $11,467.0. Bitcoin left the support and Resistance levels untested at an early stage.

Read More

Ethereum Rate Hits at Higher Level More Profitable Than Bitcoin Mining

Ethereum Rate Hits at Higher Level More Profitable Than Bitcoin Mining

Let’s have a look at the cryptocurrency that hovering near to the level at $10,600 mark. The Bitcoin price is consolidating to the 50-12 Hour SMA and the 200-12 Hours SMA. The strong resistance lies at the level 50-12 SMA that repeatedly rejected the price.

This repeated dismissal may drop the value down to the level at  $10,400 uphold level, which is by all accounts the main observable help level on the drawback. If case this level doesn’t hold firm, at that point you can anticipate that the cost should plunge below $10,000. For this situation, one can anticipate that BTC should tumble to the level of $9,700 before it experiences another solid help.

While this may not appear to be a huge number, remember that every one of these addresses holds a great many dollars worth of Bitcoin. The fishes using the stale value activity to merge their positions look good for the general market.

With respect to the top 50 digital forms of money, the greatest failures incorporate Compound, down 12% over the most recent 24 hours, UMA down 12%, OMG Network down at the level 13%, Yearn.finance down 16%, and Aave down 18%. The main bull among the sloths of bears is EOS, which broke out greatly as covered Tuesday.

Ethereum has since September 23, been holding inside a rising equal channel. Recuperation towards $400 flamed out marginally above $360 a week ago. On the drawback, the misfortunes that followed grasped uphold at the level of $335 throughout the end of the week, permitting the shrewd agreement sign to revitalize, making strides above $350.

The Ethereum selling pressure in the market halted the increase at the 50 SMA and 100 SMA. Ether fell below the climbing channel, confirming a bear banner.

The downside of a significant help zone shows that Ethereum is at grave risk of spiraling to the level at $300. Other than the various simple help zones, the most significant one lies somewhere in the range of $298 and $309. Previously, around 879,000 locations purchased almost 2 million ETH.

Read More

Cryptocurrency Bitcoin Shows the Bullish Divergence on User Count

Cryptocurrency Bitcoin Shows the Bullish Divergence on User Count

The Bitcoin moves back and shows the bearish to the start of the day with the support level at $10,900 to the broader market.

The Bitcoin BTC to USD is rose by the level at 1.33% this Tuesday and reversing the loss at the level of 0.83% on Monday.

It was a mixed start to the day. Bitcoin fell to an early morning low $10,674.2 before finding support.

Steering clear of the major support levels, Bitcoin struck a late morning high at the level of $10,815.4 before operating reverse.

Coming up short of the major resistance levels, Bitcoin slid to a late afternoon intraday low $10,654.0.

Steering clear of the first major support level at $10,585, Bitcoin rallied to a final hour intraday high at the level of $10,889.0.

Falling short of the first major resistance level at $10,915, Bitcoin eased back to end the day at sub-$10,860 levels.

The near-term bullish trend remained whole, in contempt of the latest pullback. For the bears, Bitcoin would need to slide through the 62% FIB of $6,400 to form a near-term bearish trend. At the hour of composing, Bitcoin was somewhere around 0.28% to the level of $10,826.0. It was a blended beginning to the day. Bitcoin rose to an early morning high $10,866.0 before tumbling to a low $10,826.0.

Bitcoin started the significant help and obstruction levels untested from the get-go. Somewhere else, it was a blended beginning to the day.

Bitcoin Cash ABC (+0.54%), Bitcoin Cash SV to the level (+0.62%), and Crypto.com Coin (+0.65%) evaded the pattern right off the bat.

It was a bearish beginning to the day for the remainder of the majors, in any case. Binance Coin was somewhere around 1.18% to lead the way down.

https://xtreamforex.com/nasdaq-futures-shows-the-short/

Read More

Popular Articles

USD/JPY Holds Steady Near 147.00 as Yen Weakens on Trade Tensions and BoJ Rate Outlook

USD/JPY Holds Steady Near 147.00 as Yen Weakens on Trade Tensions and BoJ Rate Outlook

Gold Struggles Below $3,300 as Fed Rate Cut Hopes Dim Ahead of FOMC Minutes

Gold Struggles Below $3,300 as Fed Rate Cut Hopes Dim Ahead of FOMC Minutes

EUR/USD Drops Toward 1.1700 as US Dollar Strengthens

EUR/USD Drops Toward 1.1700 as US Dollar Strengthens; FOMC Minutes in Spotlight

Forex Trading

Unlocking the Power of Forex Trading: Why Xtreme Markets is Your Ultimate Trading Partner

Commodity currencies

What Are Commodity Currencies? How They Impact Your Forex Trades

AI changing Forex trading?

How is AI changing Forex trading?

Categories

,
,
,

Subscribe Now!