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He Lifeng: We must go all out to promote high-quality development, continue to implement the moderately loose monetary policy, strengthen financial support for key areas such as expanding domestic demand, technological innovation, and small and micro enterprises, steadily and orderly advance financial reform and opening up, and do a good job in expectation management.December 12th - Market analysts say oil prices rose today, but a significant drop is still possible this week. Diplomatic efforts to end the Russia-Ukraine conflict, coupled with overall bearish fundamentals, suggest a supply glut next year. Next week, market focus is expected to be on the Russia-Ukraine negotiations, while traders also watch the escalating tensions between the US and Venezuela. The International Energy Agency (IEA) stated that market-expected surpluses have narrowed, but a large supply glut still casts a shadow over the outlook. In contrast, OPECs supply and demand forecasts point to a relatively balanced market next year. ANZ analysts said, "This is a stark reversal of the outlook that predicted a tighter market earlier this year."On December 12th, KPMGs Chief UK Economist, Yael Selfin, stated in a report that UK GDP contracted by 0.1% month-on-month in the three months of October, and growth is expected to remain weak for the remainder of the fourth quarter. Economic activity in November may be constrained by uncertainty surrounding the government budget. She pointed out that although the budget avoided an early tax increase and borrowing costs are expected to decline over the next year, its impact may persist, and household confidence is unlikely to improve in the short term. The outlook for investment growth is more optimistic and should be a key driver of economic growth in 2026. However, she expects GDP to remain flat in the fourth quarter of 2025.The Kremlin: The US will discuss the results of its negotiations with Ukraine with Moscow sooner or later. However, Moscow has not yet seen the revised proposals following the US-Ukraine negotiations and may "dislike much of it."Data shows that Russias seaborne petroleum product exports in November decreased by 0.8% compared to October.

Dow Jones, EUR/USD, USD/JPY, AUD/USD, GBP/USD, EU CPI, BOJ, and US GDP for the Week Ahead

Drake Hampton

Apr 25, 2022 10:49

For the fourth consecutive week, the Dow Jones Industrial Average (DJIA) fell nearly 2% as risk sentiment deteriorated rapidly into the weekend. The catalyst appeared to be a discernible increase in the Fed's rhetoric about significantly tightening policy in response to soaring inflation that threatens to undermine the economic recovery. Rate traders responded by increasing their bets on 50 basis point rate hikes via overnight index swaps, which currently price in complete 50 basis point raises for the next three FOMC meetings. The preliminary gross domestic product (GDP) growth rate for the United States is scheduled to be released on Tuesday, which will indicate how much the economy increased in March.

 

This resulted in a rebound rout in Treasuries, which spread to the rest of the world's financial markets. Government bond yields increased across the board, from UK Gilts to German Bunds. The French election this weekend may result in some European bond repricing, but the impact is likely to be minor in the event of a Macron victory. A Le Pen triumph, on the other hand, would almost certainly have a rattling effect, although polls indicate that is an improbable prospect. Eurozone inflation data for the first quarter may spark some volatility trading in EUR/USD. According to a Bloomberg survey, economists anticipate Q1 core inflation to be 3.1 percent year on year.

 

The risk-sensitive Australian and New Zealand Dollars fell against the Greenback in the Asia-Pacific region. Australia is expected to release its first-quarter inflation figures, with analysts anticipating an increase to 4.6 percent from 3.6 percent year over year. A stronger-than-expected reading could spark a recovery in the battered AUD/USD pair. A broad decline in metal prices weighed on sentiment around the Australian Dollar, which remains under pressure due to continued Chinese lockdowns.

 

USD/JPY could witness a turnaround following Thursday's Bank of Japan policy meeting outcome. The central bank has been assertive in recent months in attempting to contain bond yields, and no adjustment in the benchmark rate is expected this week. However, a change to the central bank's inflation targets may result in some currency repricing. Last week, options traders began to unwind bearish bets on the Yen, as demonstrated by a decline in one-week risk reversals. Another significant focus is the Bank of England's rate hike bets, following a bad batch of statistics that put doubt on the United Kingdom's economic recovery, with retail sales and PMIs falling short of expectations.

Weekly Performance of the US Dollar Against Currencies and Gold

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