Forex News Timeline

Wednesday, April 17, 2024

The Australian Dollar makes a U-turn and rises against the US Dollar in early trading during the North American session, gaining 0.33% amid an improvement in risk appetite.

AUD/USD is buoyed by an improved risk sentiment and a sluggish US economic calendar.Wall Street opens higher, influencing currencies despite a slight increase in the US Dollar Index.Upcoming Australian employment data could impact AUD strength, with forecasts suggesting modest job growth.The Australian Dollar makes a U-turn and rises against the US Dollar in early trading during the North American session, gaining 0.33% amid an improvement in risk appetite. A scarce economic calendar in the United States (US) and hawkish comments from Federal Reserve Chair Jerome Powell failed to boost the Greenback. The AUD/USD trades at 0.6423. AUD/USD gains despite hawkish Fed comments; focus on Australian jobs data Wall Street is setting the tone, opening with gains. US Treasury yields tumble but do not undermine the buck, which stays firm, as depicted by the US Dollar Index (DXY). The DXY is up 0.11%, at 106.24. US data revealed during the week showed that American consumers remain resilient while Industrial Production stands tall. On the negative front, US Building Permits and Housing Starts plunged due to higher mortgage rates. The Mortgage Bankers Association (MBA) revealed that rates for 30-year mortgages edged up from 7.01% to 7.13%. In addition to the data, Fed Chair Jerome Powell said that the lack of progress on inflation would likely require keeping rates steady for “as long as needed.” The markets perceived Powell as hawkish, though Wednesday’s price action suggests the opposite. In December 2023, the Fed revealed in its projections that most officials expected to cut rates three times due to the evolution of the disinflation process. Nevertheless, three months of higher inflation than expected via the Consumer Price Index (CPI) sparked Powell’s tilt and a repricing of fewer rate cuts than foreseen. On the Australian front, it would feature the release of jobs data. The Employment Change is expected to add 7.2K jobs to the workforce, well below the 116.5K created in February, while the Unemployment Rate is foreseen to edge close to 4%. If the data comes weak, that would warrant a more accommodative policy by the Reserve Bank of Australia. Hence, AUD/USD traders could push the pair lower. AUD/USD Price Analysis: Technical outlook Despite recovering, the AUD/USD is bearishly biased, and it would require buyers to achieve a daily close above the February 13 low of 0.6442. Otherwise, the pair's first support would be the 0.6400 mark, followed by the April 16 daily low of 0.6389. The next support would be 0.6350, followed by the 0.6300 mark.AUD/USD Overview Today last price 0.6426 Today Daily Change 0.0024 Today Daily Change % 0.37 Today daily open 0.6402   Trends Daily SMA20 0.6532 Daily SMA50 0.6539 Daily SMA100 0.6598 Daily SMA200 0.654   Levels Previous Daily High 0.6445 Previous Daily Low 0.6389 Previous Weekly High 0.6644 Previous Weekly Low 0.6456 Previous Monthly High 0.6667 Previous Monthly Low 0.6478 Daily Fibonacci 38.2% 0.6411 Daily Fibonacci 61.8% 0.6424 Daily Pivot Point S1 0.6379 Daily Pivot Point S2 0.6357 Daily Pivot Point S3 0.6324 Daily Pivot Point R1 0.6434 Daily Pivot Point R2 0.6467 Daily Pivot Point R3 0.649    

In an interview with WiWo on Wednesday, European Central Bank (ECB) policymaker and Bundesbank Chief Joachim Nagel said that price pressures in the Eurozone could continue for some time, per Reuters.

In an interview with WiWo on Wednesday, European Central Bank (ECB) policymaker and Bundesbank Chief Joachim Nagel said that price pressures in the Eurozone could continue for some time, per Reuters. "It's not completely clear if the inflation rate will reach 2% target next year and stay at this level," Nagel added and noted that he expects a "slight growth" in German economy in 2024. Market reaction These comments don't seem to be impacting the Euro's valuation in a noticeable way. At the time of press, EUR/USD was up 0.15% on the day at 1.0635.

United States EIA Crude Oil Stocks Change above expectations (1.6M) in April 12: Actual (2.735M)

Silver price (XAG/USD) advances to $28.60 in Wednesday’s early New York session.

Silver price jumps higher to $28.60, driven by worsening geopolitical tensions.Israel’s response to Iran’s attack will escalate fears of Middle East tensions spreading beyond Gaza.US bond yields edge down despite Fed lean towards higher interest rates for a longer period.Silver price (XAG/USD) advances to $28.60 in Wednesday’s early New York session. The white metal witnesses significant buying interest as deepening Middle East tensions keep safe-haven bid firm. Investors are worried that tensions in the Middle East region could spread beyond Gaza as Israel said it will respond to Iran’s attack on their territory. The Iranian military launched hundreds of missiles and drones on Saturday in retaliation to Israel’s attack on the Iranian embassy near Damascus in Syria in which two high-rank generals were killed. After Iran’s attack on Israel Tehran said, “the matter deemed to be closed.” However, should the Israeli regime make another mistake, Iran’s response will be considerably more severe, Wall Street Journal reported. The appeal for bullions strengthens when investors see geopolitical tensions escalating further. Meanwhile, 10-year US Treasury yields fall to 4.63% despite Federal Reserve (Fed) sees interest rates remaining higher for a longer period. A decline in yields on interest-bearing assets eases the opportunity cost of holding an investment in non-yielding assets, such as Silver. The US Dollar Index (DXY) exhibits strength near 106.20 as robust US Retail Sales data for March has improved the economic outlook. Higher spendings by households are done when labor market conditions remain tight, suggest strong economic outlook. Silver technical analysis Silver price faces selling pressure while attempting to break above horizontal resistance plotted from 3 August 2020 high at $29.86. The long-term outlook of the white metal is bullish as the 20-week Exponential Moving Average (EMA) at $24.85 is sloping higher. The 14-period Relative Strength Index (RSI) shifts into the bullish range of 60.00-80.00, suggesting a strong upside momentum. Silver weekly chartXAG/USD Overview Today last price 28.74 Today Daily Change 0.64 Today Daily Change % 2.28 Today daily open 28.1   Trends Daily SMA20 26.44 Daily SMA50 24.58 Daily SMA100 24.03 Daily SMA200 23.65   Levels Previous Daily High 29.02 Previous Daily Low 27.95 Previous Weekly High 29.8 Previous Weekly Low 26.88 Previous Monthly High 25.77 Previous Monthly Low 22.51 Daily Fibonacci 38.2% 28.36 Daily Fibonacci 61.8% 28.61 Daily Pivot Point S1 27.7 Daily Pivot Point S2 27.3 Daily Pivot Point S3 26.64 Daily Pivot Point R1 28.76 Daily Pivot Point R2 29.42 Daily Pivot Point R3 29.82        

The USD/CAD pair dipped to round-level support of 1.3800 in Wednesday’s early American session.

USD/CAD slumps to 1.3800 even though the US Dollar exhibits strength.Investors see the BoC choosing the June meeting as their earliest point for pivoting to rate cuts.Oil prices weaken as Fed Powell’s hawkish guidance raises doubts over global economic outlook.The USD/CAD pair dipped to round-level support of 1.3800 in Wednesday’s early American session. The Loonie asset faces pressure despite multiple tailwinds, such as higher Bank of Canada (BoC) rate cut hopes, a sharp decline in the Oil price, and hawkish guidance from Federal Reserve (Fed) Chair Jerome Powell. The S&P 500 opens on a positive note, suggesting an improvement in the risk appetite of the market participants. 10-year US Treasury yields edge down to 4.64% but are still close to a five-month high as Fed Powell supported the argument of keeping interest rates higher for a longer period. Meanwhile, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, turns sideways above 106.00. Traders are pricing in a rate cut by the BoC in the June meeting as inflation remains on course towards the required rate of 2%. The BoC’s preferred inflation measure, the Core Consumer Price Index (CPI), which excludes eight volatile items, softened to 2.0% from the prior reading of 2.1%. Last week, BoC Governor Tiff Macklem acknowledged that a rate cut in June is possible if inflation continues to decelerate sustainably after keeping interest rates unchanged at 5%. Meanwhile, West Texas Intermediate (WTI), futures on NYMEX, have dropped to $84.00 as the dismal global economic outlook outweighs tight supply fears. Higher prospects for the Fed maintaining the monetary policy framework for a longer period weigh on the Oil price. Investors fear the global oil supply remaining tight amid deepening Middle East tensions. USD/CAD Overview Today last price 1.3791 Today Daily Change -0.0038 Today Daily Change % -0.27 Today daily open 1.3829   Trends Daily SMA20 1.3607 Daily SMA50 1.3551 Daily SMA100 1.3488 Daily SMA200 1.352   Levels Previous Daily High 1.3846 Previous Daily Low 1.3774 Previous Weekly High 1.3787 Previous Weekly Low 1.3547 Previous Monthly High 1.3614 Previous Monthly Low 1.342 Daily Fibonacci 38.2% 1.3819 Daily Fibonacci 61.8% 1.3802 Daily Pivot Point S1 1.3787 Daily Pivot Point S2 1.3744 Daily Pivot Point S3 1.3715 Daily Pivot Point R1 1.3859 Daily Pivot Point R2 1.3888 Daily Pivot Point R3 1.3931    

USD/JPY is trading in the upper 154.00s. It has formed what looks like a Measured Move price pattern composed of three waves, commonly labeled A, B and C.

USD/JPY extends its uptrend into the 154.00s. It may be forming a Measured Move pattern with an end target of 156.11. RSI is overbought, however, warning a correction may be on the horizon. USD/JPY is trading in the upper 154.00s. It has formed what looks like a Measured Move price pattern composed of three waves, commonly labeled A, B and C.  In the case of Measured Moves, the end of wave C can be reliably predicted because it is often at the point where wave C is equal in length to wave A, or a Fibonacci ratio of wave A. At the very least wave C normally extends to a 0.618 ratio of A.  USD/JPY Daily ChartThe end of C if it ends equal to A it will reach roughly 156.11 and there is a chance the rally could extend that high.  However, it is also the case that price has already reached the conservative target for the end of wave C at the Fib. 0.618 extension of A, at 154.20, which means there is a possibility it may have unfolded to its limit.  In addition, the Relative Strength Index (RSI) is well into overbought territory, recommending bullish traders with a medium-term outlook should not increase their long bets. If RSI exits overbought it may be a sign USD/JPY is pulling back.  For USD/JPY bulls the important thing is that price itself continues to rise and as long as it does the uptrend is likely to continue.  

The AUD/USD pair finds a cushion near the round-level support of 0.6400 in Wednesday’s early American session.

AUD/USD recovers from 0.6400 amid improved market sentiment.The Aussie Employment data will guide market expectations for RBA rate cuts.It is forecasted that Australian employers hired mere 7.2K workers in March.The AUD/USD pair finds a cushion near the round-level support of 0.6400 in Wednesday’s early American session. A three-day losing spell in the Aussie asset has concluded for now as investors expect that nations other than the United States are also facing stubborn inflation issues. The Consumer Price Index (CPI) data for the United Kingdom and the New Zealand economies released in Wednesday’s session indicated that the last mile for inflation to return to the 2% target is bumpy. UK’s inflation softened slower than estimated in March while NZ inflation grew as expected in the first quarter of 2024. This has forced traders to reprice their expectations for initial rate cuts. For the Bank of England (BoE) and the Reserve Bank of New Zealand (RBNZ), investors are now expecting that they will pivot to rate cuts from the November meeting instead of September. Meanwhile, the market sentiment has improved. Considering bullish overnight futures, the S&P 500 is expected to open on a positive note. 10-year US Treasury yields fall slightly to 4.64% after refreshing a five-month high at 4.7%. The US Dollar Index (DXY) turns sideways after printing a fresh five-month high at 106.40. The US Dollar holds strength as Federal Reserve (Fed) Chair Jerome Powell leaned for keeping interest rates higher for a longer period as inflation data for March was not encouraging. On the Australian Dollar front, investors await the Employment data for March, which will be published on Thursday. The Unemployment Rate is forecasted to have increased to 3.9% from 3.7% in February. In the same period, Australian employers are estimated to have hired 7.2K workers, significantly lower from 116.5K. Weak employment numbers would lift expectations for rate cuts by the Reserve Bank of Australia (RBA). AUD/USD Overview Today last price 0.6434 Today Daily Change 0.0032 Today Daily Change % 0.50 Today daily open 0.6402   Trends Daily SMA20 0.6532 Daily SMA50 0.6539 Daily SMA100 0.6598 Daily SMA200 0.654   Levels Previous Daily High 0.6445 Previous Daily Low 0.6389 Previous Weekly High 0.6644 Previous Weekly Low 0.6456 Previous Monthly High 0.6667 Previous Monthly Low 0.6478 Daily Fibonacci 38.2% 0.6411 Daily Fibonacci 61.8% 0.6424 Daily Pivot Point S1 0.6379 Daily Pivot Point S2 0.6357 Daily Pivot Point S3 0.6324 Daily Pivot Point R1 0.6434 Daily Pivot Point R2 0.6467 Daily Pivot Point R3 0.649    

European Central Bank (ECB) Executive Board member Piero Cipollone said on Wednesday that they are seeing some signs of economic recovery in the Euro area, citing the latest PMI data.

European Central Bank (ECB) Executive Board member Piero Cipollone said on Wednesday that they are seeing some signs of economic recovery in the Euro area, citing the latest PMI data. Cipollone said that they expect inflation to resume on its path toward 2% next year and reach the target in 2025. "If the incoming data in June and July confirm that confidence about the target improves, it will be appropriate to remove some restrictive measures imposed in 2023," he added, per Reuters, but noted that the impact of the Middle East conflict on energy costs is a major risk.  Market reaction These comments don't seem to be having a significant impact on the Euro's performance against its rivals. At the time of press, EUR/USD was up 0.22% on the day at 1.0640.

USD/CHF is rallying in an ascending channel on the daily chart.

USD/CHF is trending higher within a rising channel. The trend is expected to continue to the next set of targets. A break below the lower channel line would be required to signal a reversal. USD/CHF is rallying in an ascending channel on the daily chart. It is in a short and medium-term uptrend which is expected to continue higher given the old adage that the “trend is your friend.”  USD/CHF Daily Chart
 USD/CHF has been consolidating over the past few days in the lower 0.9100s but it will probably eventually break higher in accordance with the dominant uptrend. A break above the 0.9152 April highs would confirm more upside.  The next target to the upside comes in at around 0.9173 where some major moving averages converge on higher time-frame charts.  Following that, the next upside target would be located at 0.9240 the level of previous major swing highs made in October 2023. The Relative Strength Index (RSI) is not overbought any longer, suggesting scope for further upside.  A decisive break below the lower boundary of the channel, currently at roughly 0.9020, would reverse the outlook and bring into question the direction of the intermediate trend.  A decisive break would be one characterized by a breach with a longer-than-average red candlestick or three consecutive red candlesticks.   

"Achieving inflation target has been a bumpy ride, it was always going to be and that last mile is the hardest work,"Bank of England (BoE) Monetary Policy Committee (MPC) member Megan Greene said on Wednesday.

"Achieving inflation target has been a bumpy ride, it was always going to be and that last mile is the hardest work,"Bank of England (BoE) Monetary Policy Committee (MPC) member Megan Greene said on Wednesday. "We're closer to target than we were just a few months ago, so the news has been encouraging," Greene added and noted that she is worried about what an energy price shock and other supply side shocks might do to inflation expectations. Market reactionGBP/USD showed no reaction to these comments and the pair was last seen rising 0.25% on the day at 1.2457.  

The EUR/GBP edges lower a fraction on Wednesday to trade at about the 0.8540 level, after the release of macroeconomic data from both the UK and Eurozone.

EUR/GBP declines after the release of higher-than-expected UK inflation data suggests UK interest rates could stay high. “This is not what the BoE wants to see,” says TD Securities analyst. Eurozone inflation data comes out in line with expectations, lifting the Euro amid dovish market expectations. The EUR/GBP edges lower a fraction on Wednesday to trade at about the 0.8540 level, after the release of macroeconomic data from both the UK and Eurozone.  In the UK, inflation rose slightly higher than expected in March, according to data from the Office of National Statistics (ONS), on Wednesday. The Consumer Price Index (CPI) in March rose 3.2% year-on-year when a 3.1% rise had been expected. That said it was below the 3.6% of the previous month.  Core CPI rose 4.2% versus the 4.1% expected reading but was also lower than the previous month. The same was true of the Retail Price Index (RPI) whilst the Producer Price Index showed results either inline with expectations or slightly below them.  The data gave a lift to the Pound Sterling, perhaps because it reduces the probabilities that the Bank of England (BoE) will be able to start reducing interest rates.  “Overall, this is not what the BoE wants to see, in particular after the stronger than expected wage numbers out yesterday," said analysts at TD Securities, responding to the data.   It means the BoE may need to keep interest rates higher for longer in order to combat stickier-than-expected inflation. Higher interest rates tend to appreciate a currency as they lead to higher foreign capital inflows.  EUR/GBP recovered some lost ground following the release of the final estimate for the March Eurozone Harmonized Index of Consumer Prices (HICP), on Wednesday.  The data showed no change from the flash reading, which showed a 2.4% YoY rise in HICP and 2.9% in core HICP. Both readings were still below the 2.6% and 3.1% readings respectively for February.  The Euro (EUR) may have been lifted because market expectations had overall declined in relation to Eurozone inflation. Recent dovish comments from European Central Bank (ECB) officials, have suggested an increasing willingness to cut interest rates because of falling inflation and stuttering growth, and this could have been responsible for the lower outlook. 
ECB President Christine Lagarde, for example, said on Tuesday that the ECB will cut rates soon, bar a surprise, and that the ECB was keeping a close eye on Oil prices due to Middle East tensions.

Canada Canadian Portfolio Investment in Foreign Securities increased to $24.19B in February from previous $-7.59B

Canada Foreign Portfolio Investment in Canadian Securities registered at $-8.78B, below expectations ($10.1B) in February

Analysts at TD Securities think that the Bank of Canada (BoC) remains on track to start lowering the policy rate before the Federal Reserve (Fed) following the latest inflation data.

Analysts at TD Securities think that the Bank of Canada (BoC) remains on track to start lowering the policy rate before the Federal Reserve (Fed) following the latest inflation data. Third consecutive miss for headline CPI weighed on CAD "Headline CPI edged higher to 2.9% y/y in March, in line with the market consensus, but details were considerably softer with further progress across the Bank of Canada's preferred measures of core inflation and inflation breadth. CPI-trim/median edged lower to 2.95% y/y on average, as another 0.1% m/m increase saw 3m core inflation rates fall to just 1.3%." "Today's report provides the Bank of Canada with some additional evidence that recent inflation progress was sustained through March, but we would note the ex. food/energy aggregate saw a much stronger performance, and there is still the risk that recent progress is unwound in April. We do not think today's report is enough to lock in a June cut and still think July is the more likely start to the BoC's easing cycle, but today's report will add to the risk of an earlier move." "The third consecutive miss for headline CPI weighed on CAD and leaves the Bank of Canada on track to start cutting comfortably before the Fed."

Analysts at BBH share their near-term outlook for the US Dollar Index (DXY).

Analysts at BBH share their near-term outlook for the US Dollar Index (DXY). Chair Powell and other Fed officials have taken a more hawkish turn "The dollar rally is taking a breather.  DXY is trading lower for the first time since last Monday near 106.165 after making a new cycle yesterday near 106.517.  It remains on track to test the November 1 high near 107.113." "The euro is trading higher near $1.0645 but the clean break below $1.0755 sets up a test of the November 1 low near $1.0515.  Elsewhere, sterling is trading higher near $1.2465 after higher-than-expected CPI data.  USD/JPY is trading lower near 154.60 after making a new cycle high near 154.80 yesterday." "The dollar rally should continue as recent data confirm persistent inflation and robust growth in the U.S.  In turn, Chair Powell and other Fed officials have taken a more hawkish turn.  This should keep upward pressure on U.S. yields, and this is what the Fed wants in lieu of another hike. We believe that while market easing expectations have adjusted violently after CPI and now Powell, there is still room to go.  When the market finally capitulates on the Fed, the dollar should gain further." 

The US Dollar Index (DXY) eases slightly on Wednesday as it becomes increasingly clear that markets won the arm wrestling match with the US Federal Reserve (Fed).

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The recent upward moves in both US bond yields and the US Dollar were enough to twist the arm of US Fed Chairman Jerome Powell. Powell said on Tuesday that recent data shows a lack of further progress in taming inflation, and that it will take longer before having enough confidence that price growth is coming down to target before considering the first rate cut. On the economic data front, no market-moving data is expected besides some second-tier numbers. More importantly, Fed speakers will take the stage right at the end of the US session, with Federal Reserve Bank of Cleveland President Loretta Mester and Federal Reserve Governor Michelle Bowman to speak. Daily digest market movers: Powell upheavalThe weekly Mortgage Bankers Applications have be released for the week of April 12. Last week the index printed 0.1% with this week at 3.3% despite elevated rate levels. The US Treasury is holding a longer-term bond auction at 17:00 GMT for a 20-year bond. The Fed’s Beige Book will be released at 18:00 GMT.  At 20:00 GMT, the Treasury International Capital (TIC) Flows will be released for February: Net Long-Term TIC Flows expected to head from $36.1 billion to $40.2 billion. Total Net TIC Flows were in January at $-8.8 billion with no forecast available for February. Two scheduled Fed speakers are scheduled for Wednesday: Federal Reserve Bank of Cleveland President Loretta Mester, around 21:30 GMT, participating in the South Franklin Circle Dialogues. Federal Reserve Governor Michelle Bowman is due to speak around 23:15 GMT at the Institute for International Finance in Washington D.C. Equities are in the red again, though the losses are starting to get smaller. US equity futures might even flip into the green later into this session.  According to the CME Group’s FedWatch Tool, expectations for a Fed pause in the May meeting are at 94.6%, while chances of a rate cut stand at 5.4%. It looks like markets are easing off their most hawkish outlook.  The benchmark 10-year US Treasury Note trades around 4.65%. The benchmark is retreating from the highs at 4.69% seen on Tuesday. US Dollar Index Technical Analysis: Small retreat, broader picture still bullishThe US Dollar Index (DXY) eases a touch on Wednesday. With Fed Chairman Powell confirming that it will take longer than expected to start lowering interest rates, some unwinding of the rally that took place in the DXY since last week’s Consumer Price Index numbers is likely. Expect a bit of a pullback, although the substantial wider rate differential between higher US rates and the rest of the world should keep the DXY at higher levels above 104.00. On the upside, the fresh high of Tuesday at 106.52 is the level to beat first. Further up and above the 107.00 round level, the DXY Index could meet resistance at 107.35, the October 3 high.  On the downside, the first important level is 105.88, a pivotal level since March 2023, which proved its importance on Monday by holding as a support. Further down, 105.12 and 104.60 should also act as a support ahead of the region with both the 55-day and the 200-day Simple Moving Averages (SMAs) at 104.17 and 103.91, respectively. US Dollar FAQs What is the US Dollar? The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away. How do the decisions of the Federal Reserve impact the US Dollar? The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback. What is Quantitative Easing and how does it influence the US Dollar? In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar. What is Quantitative Tightening and how does it influence the US Dollar? Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.  

The EUR/JPY is trading in the mid 164.00s on Wednesday, up by over a tenth of a percent.

EUR/JPY continues rising after the release of final Eurozone inflation data shows no change from estimates. Comments from the Japanese Cabinet Secretary suggest the authorities may be close to an FX market intervention. Further commentary from ECB speakers could cause fluctuations for EUR/JPY. The EUR/JPY is trading in the mid 164.00s on Wednesday, up by over a tenth of a percent. The pair’s fluctuations seem to have been mainly driven by a combination of Eurozone inflation data and comments from a Japanese government official designed to support the Japanese Yen (JPY).  EUR/JPY rose following the release of the final figure for March Eurozone Harmonized Index of Consumer Prices (HICP) by Eurostat. The final estimate showed no change from the initial release, which showed a 2.4% YoY rise in HICP and 2.9% in core HICP. This also meant both readings were still below the 2.6% and 3.1% readings respectively of the previous month.  Whilst the data showed no change, the Euro (EUR) rose in most pairs following the release, perhaps because market expectations had fallen. Recent dovish comments from European Central Bank (ECB) officials, have suggested an increasing willingness to cut interest rates because of falling inflation and stuttering growth, and this could have been responsible for the lower outlook.  On Tuesday, for example, ECB President Christine Lagarde said that the ECB will cut rates soon, bar a surprise, and that the ECB was keeping a close eye on Oil prices due to tensions in the Middle East.  EUR/JPY upside has likely been tempered by comments from Japan’s Chief Cabinet Secretary Yishimasa Hayashi, who issued a verbal intervention on Wednesday to prop up the Yen. Hayashi said that “we are closely watching FX moves” and are “prepared for full measures.” This may indicate the Japanese authorities are seriously considering a direct intervention in FX markets in which they would sell their FX reserves to buy JPY in the hope of strengthening it. The knock-on effect of such an intervention, though felt most keenly in USD/JPY, would probably result in a weakening in the EUR/JPY pair.  His intervention may have come on the back of recent comments from Federal Reserve Chairman Jerome Powell, in which he said “Recent data shows a lack of further progress on inflation this year,” adding, “If higher inflation persists the Fed can maintain current rate as long as needed.”  His comments led to an appreciation of the US Dollar because the maintenance of higher interest rates tends to be positive for a currency. This is due to the fact that it increases foreign capital inflows. Powell’s remarks resulted in USD/JPY rising to above 154.00. This is above the ideal 150.00 threshold beyond which the Japanese do not like to see their currency devalue.  A string of speeches by key ECB members during Wednesday, including ECB Executive Board Member Piero Cipollone, ECB Executive Board Member Isabel Schnabel and President Christine Lagarde herself could also impact the EUR/JPY’s volatility.  The release of Japanese trade data overnight had little effect on the exchange rate.  The data showed only a slight moderation in Exports, which continued to grow by above 7.0% year-on-year in March, a fall in Imports by 4.9% (after a 0.5% rise in the preceding month), and a surplus trade balance of ¥366.5 billion from a ¥377.8 billion deficit in February.  

South Africa Retail Sales (YoY) climbed from previous -2.1% to -0.8% in February

United States MBA Mortgage Applications climbed from previous 0.1% to 3.3% in April 12

The NZD/USD pair extends its recovery to the round-level resistance of 0.5900 in Wednesday’s European session.

NZD/USD moves higher to 0.5900 as traders see the RBNZ reducing key interest rates from November.NZ Q1 inflation grew by 0.6% as expected.Fed Powell returns to the “higher for longer interest rates” argument.The NZD/USD pair extends its recovery to the round-level resistance of 0.5900 in Wednesday’s European session. The Kiwi asset strengthens as traders repriced bets supporting rate cuts by the Reserve Bank of New Zealand (RBNZ). Investors now see the RBNZ beginning to lower borrowing rates from the November meeting instead of the October meeting. Market expectations for the RBNZ starting to reduce its Official Cash Rate (OCR) have been significantly influenced by the expected rise in New Zealand’s Q1 Consumer Price Index (CPI) data released in Wednesday’s early Asian session. Stats NZ showed that NZ inflation rose by 0.6% as expected, higher from 0.5% growth recorded in the last quarter of 2023. The annual inflation data decelerated to 4.0% against the prior reading of 4.7%. Currently, the RBNZ has been maintaining its Official Cash Rate (OCR) at 5.5%. A sharp improvement in market sentiment has also boosted demand for the New Zealand Dollar. S&P 500 futures have posted significant gains in the European session. 10-year US Treasury yields have dropped slightly to 4.64%. The rally in the US Dollar Index (DXY) seems stalled near 106.40 as investors had priced in that the Federal Reserve (Fed) will lean towards keeping interest rates higher for a longer period. On Tuesday, Fed Chair Jerome Powell said, “The recent data have clearly not given us greater confidence, and instead indicate that it’s likely to take longer than expected to achieve that confidence” reported Reuters. In this statement, the recent data is hot consumer price inflation data for March. Currently, financial markets are anticipating that the Fed will start reducing interest rates from the September meeting. NZD/USD Overview Today last price 0.5909 Today Daily Change 0.0029 Today Daily Change % 0.49 Today daily open 0.588   Trends Daily SMA20 0.5993 Daily SMA50 0.6075 Daily SMA100 0.6132 Daily SMA200 0.6062   Levels Previous Daily High 0.5908 Previous Daily Low 0.5868 Previous Weekly High 0.6079 Previous Weekly Low 0.5933 Previous Monthly High 0.6218 Previous Monthly Low 0.5956 Daily Fibonacci 38.2% 0.5884 Daily Fibonacci 61.8% 0.5893 Daily Pivot Point S1 0.5863 Daily Pivot Point S2 0.5846 Daily Pivot Point S3 0.5823 Daily Pivot Point R1 0.5902 Daily Pivot Point R2 0.5925 Daily Pivot Point R3 0.5942    

Natural Gas (XNG/USD) trades flat in a narrow range on Wednesday, digesting the overnight headlines that came out about lingering tensions in the Middle East.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} Natural Gas prices are steady on Wednesday but futures on European markets jump.Markets see tensions simmer amid uncertainty about Israel’s retaliation against Iran.The US Dollar Index consolidates after Fed Chairman Powell confirms delay in interest-rate cuts. Natural Gas (XNG/USD) trades flat in a narrow range on Wednesday, digesting the overnight headlines that came out about lingering tensions in the Middle East. White House National Security Advisor Jake Sullivan said to Bloomberg that the outline of the sanctions against Iran will come in the following days and will specifically target the country’s drone plan. Meanwhile, in the Middle East, Saudi Arabia’s Crown Prince Mohammed Bin Salman and UAE President Mohammed Bin Zayed Al Nahyan issued a rare joint statement calling for self-restraint and pointed to the dangers of war.  Meanwhile, the US Dollar Index (DXY) is weakening after its staggering five-day winning streak. Some further easing is in the cards with a very light economic calendar ahead and markets no longer looking to force the US Federal Reserve to change its stance. US Federal Reserve Chairman Jerome Powell said on Tuesday that current inflation levels do not call for a rate cut, suggesting that interest rates will stay steady for longer until inflation comes down.  Natural Gas is trading at $1.90 per MMBtu at the time of writing.  Natural Gas news and market movers: A war that no one wants The Barrow North LNG terminal in the United kingdom is undergoing an unplanned maintenance call. Meanwhile, Gas flows from Norway to Europe are recovering after a series of unforeseen outages at some of its major fields. Local European Gas Futures have risen by 20% in just five days. Prices are likely to ease, though, as Norwegian flows pick up to normal volumes again. European Gas storages are filled up by 62% and are set to get refueled over the summer period. Headline risks are still in the balance on Wednesday as markets await details over Israel’s retaliatory measures against Iran. Natural Gas Technical Analysis: A short breather, enjoy it while it lastsNatural Gas prices are in a soft patch on Wednesday, for as long as no clear headlines out of Israel hit the wires on what the next steps will be on Iran. The breather should give prices some room for a small retrace, though nothing substantial. With headline risk at hand, expect the main support barriers to remain unchallenged.  On the upside, the red descending trend line at $1.99-$2.00 looks ready for another test. Should Gas prices snap above it, a quick rally to $2.11 could be seen. Not that far off, $2.15 in the form of the 100-day Simple Moving Average (SMA) becomes the main resistance level. On the downside, the 55-day SMA around $1.88 should be a safety net. Next, the green ascending trend line near $1.83 should support the rally since mid-February. Should even that level break, a dive to $1.60 and $1.53 would not be impossible. Natural Gas: Daily Chart Natural Gas FAQs What fundamental factors drive the price of Natural Gas? Supply and demand dynamics are a key factor influencing Natural Gas prices, and are themselves influenced by global economic growth, industrial activity, population growth, production levels, and inventories. The weather impacts Natural Gas prices because more Gas is used during cold winters and hot summers for heating and cooling. Competition from other energy sources impacts prices as consumers may switch to cheaper sources. Geopolitical events are factors as exemplified by the war in Ukraine. Government policies relating to extraction, transportation, and environmental issues also impact prices. What are the main macroeconomic releases that impact on Natural Gas Prices? The main economic release influencing Natural Gas prices is the weekly inventory bulletin from the Energy Information Administration (EIA), a US government agency that produces US gas market data. The EIA Gas bulletin usually comes out on Thursday at 14:30 GMT, a day after the EIA publishes its weekly Oil bulletin. Economic data from large consumers of Natural Gas can impact supply and demand, the largest of which include China, Germany and Japan. Natural Gas is primarily priced and traded in US Dollars, thus economic releases impacting the US Dollar are also factors. How does the US Dollar influence Natural Gas prices? The US Dollar is the world’s reserve currency and most commodities, including Natural Gas are priced and traded on international markets in US Dollars. As such, the value of the US Dollar is a factor in the price of Natural Gas, because if the Dollar strengthens it means less Dollars are required to buy the same volume of Gas (the price falls), and vice versa if USD strengthens.  

The Mexican Peso (MXN) is trending lower in the majority of its most heavily traded pairs on Wednesday.

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This is due to a combination of factors, including the decision by the International Monetary Fund (IMF) to downgrade its economic growth forecasts for Mexico in 2024-2025, as well as fading Oil prices – a key export for the country.   The impact of stubbornly high inflation in the US and recent remarks from the Chairman of the Federal Reserve (Fed), Jerome Powell, that suggest the Fed may not cut interest rates until September (from previous expectations of June), were further factors posited as influencing the Mexican Peso’s reversal in fortunes. Mexican Peso declines after IMF revises down growth The Mexican Peso is taking another step lower after the IMF downgraded its growth forecasts for Mexico over the next two years on Tuesday. It reduced its 2024 forecast to 2.4% from 2.7% and 1.4% in 2025 from 1.5% previously estimated.  “The forecast for Mexico is revised downward on account of weaker-than-expected outcomes for end-2023 and early 2024, with a contraction in manufacturing,” the IMF said in its latest World Economic Outlook report. This follows similar downgrades from the Banxico in February, when it reduced its growth forecast to 2.8% from 3.0% in 2024, as per The Wall Street Journal.  The fall off in growth is anticipated as a result of lower government spending in an effort to bring down the budget deficit.  “Mexico’s Ministry of Finance expects the fiscal deficit to decrease from 5% to 2.5% of the Gross Domestic Product (GDP) next year, which would imply a cut in spending of 833.6 billion Pesos, according to the Pre-General Policy Criteria Economic 2025,” says Christian Borjon Valencia, Editor at FXStreet.com In its March meeting, the Banxico reduced interest rates from 11.25% to 11.00% due to evidence of lower inflation and growth. However, the move failed to completely reverse the Mexican Peso’s long-term uptrend.  Higher inflation in the US and recent comments from Fed Chairman Powell, however, may have reversed the trend for the Peso – in particular against the US Dollar.  On Tuesday, Powell said, “Recent data shows a lack of further progress on inflation this year,” adding, “If higher inflation persists the Fed can maintain current rate as long as needed.”  Higher interest rates tend to be positive for a currency as they increase foreign capital inflows. The opposite is true for lower interest rates. Given the divergence in the two country’s monetary policy stances, with Banxico cutting and the Fed holding, the Mexican Peso’s long-term appreciation versus the Buck looks at risk of breaking down. Technical Analysis: USD/MXN reverses trend in the short-term USD/MXN – the value of one US Dollar in Mexican Pesos – has probably reversed its short-term downtrend.  The peaks and troughs of price are rising on the 4-hour chart used by many analysts to assess the short-term trend. This suggests the pair is now in an uptrend, favoring bulls.  USD/MXN 4-hour Chart One caveat to the bullish outlook is that the Relative Strength Index (RSI) is pulling back from overbought into neutral territory. Given price is also declining, the two taken together could be signaling the start of a correction. When the RSI moves out of overbought territory it is a signal for short-term time horizon traders to close long positions and open short trades.  If the pair continues pulling back it could fall to the 50-day Simple Moving Average (SMA) at 16.82 and find support there. Given the dominance of the short-term uptrend, however, it is likely to eventually recover and start going higher.  A break above Tuesday’s high at 17.09 would indicate a continuation of the uptrend to the next target, possibly located at 17.17 where the 200-day SMA is situated, followed by resistance from a long-term trendline and resistance level at around 17.37.  Mexican Peso FAQs What key factors drive the Mexican Peso? The Mexican Peso (MXN) is the most traded currency among its Latin American peers. Its value is broadly determined by the performance of the Mexican economy, the country’s central bank’s policy, the amount of foreign investment in the country and even the levels of remittances sent by Mexicans who live abroad, particularly in the United States. Geopolitical trends can also move MXN: for example, the process of nearshoring – or the decision by some firms to relocate manufacturing capacity and supply chains closer to their home countries – is also seen as a catalyst for the Mexican currency as the country is considered a key manufacturing hub in the American continent. Another catalyst for MXN is Oil prices as Mexico is a key exporter of the commodity. How do decisions of the Banxico impact the Mexican Peso? The main objective of Mexico’s central bank, also known as Banxico, is to maintain inflation at low and stable levels (at or close to its target of 3%, the midpoint in a tolerance band of between 2% and 4%). To this end, the bank sets an appropriate level of interest rates. When inflation is too high, Banxico will attempt to tame it by raising interest rates, making it more expensive for households and businesses to borrow money, thus cooling demand and the overall economy. Higher interest rates are generally positive for the Mexican Peso (MXN) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken MXN. How does economic data influence the value of the Mexican Peso? Macroeconomic data releases are key to assess the state of the economy and can have an impact on the Mexican Peso (MXN) valuation. A strong Mexican economy, based on high economic growth, low unemployment and high confidence is good for MXN. Not only does it attract more foreign investment but it may encourage the Bank of Mexico (Banxico) to increase interest rates, particularly if this strength comes together with elevated inflation. However, if economic data is weak, MXN is likely to depreciate. How does broader risk sentiment impact the Mexican Peso? As an emerging-market currency, the Mexican Peso (MXN) tends to strive during risk-on periods, or when investors perceive that broader market risks are low and thus are eager to engage with investments that carry a higher risk. Conversely, MXN tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.  

Analysts at TD Securities note that UK inflation data came in stronger than expected in March, with headline inflation falling to 3.2% y/y and core declining to 4.2% y/y.

Analysts at TD Securities note that UK inflation data came in stronger than expected in March, with headline inflation falling to 3.2% y/y and core declining to 4.2% y/y. This is not what the BoE wants to see "Services, which matters the most to the Bank of England (BoE), edged down just 0.1ppts to 6.0% y/y (TDS/mkt/BoE: 5.8%). Surprisingly enough, airfares were not a key driver of the print—prices rose just 0.1% m/m, which especially when factoring in the early Easter this year, makes it quite a weak increase." "Instead, stronger than expected food prices drove part of the surprise, but a sharp 3.8% m/m surge in accommodation prices also put notable upside pressure on the print. Moreover, volatile components like books and video games also contributed to the upside surprise. Book prices rose a substantial 4.9% m/m—the largest m/m increase on record—and video games surged 2.3% m/m. These sorts of effects are prone to reverting after a month or two. Overall, this is not what the BoE wants to see, in particular after the stronger than expected wage numbers out yesterday."

West Texas Intermediate (WTI), futures on NYMEX, drop slightly to the crucial support of $85.00 in the European session on Wednesday.

Oil prices edge down to $85 as Fed Powell’s hawkish guidance cast doubts over global demand outlook.The US warns to levy fresh sanctions on Iran in response to its attack on Israel.Worsening geopolitical tensions will firm the oil price outlook.West Texas Intermediate (WTI), futures on NYMEX, drop slightly to the crucial support of $85.00 in the European session on Wednesday. The Oil price comes under pressure on weak demand outlook amid expectations that the Federal Reserve (Fed) will keep interest rates higher for a longer period. Stubbornly higher consumer price inflation and strong labor market data for March have dented Fed’s confidence in price pressures declining to the desired rate of 2%. On Tuesday, Fed Chair Jerome Powell said, “The recent data have clearly not given us greater confidence, and instead indicate that it’s likely to take longer than expected to achieve that confidence” reported Reuters. Apart from that, expectations for higher crude Oil inventories for the week ending April 12 have weighed on the Oil price. The United States Energy Information Administration (EIA) is forecasted to have shown a rise in in Oil stockpiles by 1.6 million barrels. In the Middle East region, fears of oil supply tightening further have deepened as Israel prepares to respond to Iran’s attack on their territory. After aiming hundreds of drones and missiles on Israel, Tehran said, “the matter deemed to be closed.” However, should the Israeli regime make another mistake, Iran’s response will be considerably more severe, Wall Street Journal reported. The spread of war situation beyond Gaza will disrupt the Oil supply chain. Iran is the third largest Oil exporting member of the OPEC and his involvement in war with Israel will significantly fluctuate global Oil prices. The long-term outlook of the Oil price remains strong if geopolitical tensions worsen further. Meanwhile, fears of fresh sanctions from the US on Iran has further escalated prospects of tight Oil supply. US Treasury Secretary Janet Yellen said that their administration intends to levy new sanctions on Iran against its attack on Israel. Fresh sanctions on Iran would impact their capacity of exporting oil. WTI US OIL Overview Today last price 84.17 Today Daily Change -0.61 Today Daily Change % -0.72 Today daily open 84.78   Trends Daily SMA20 83.76 Daily SMA50 80.2 Daily SMA100 76.76 Daily SMA200 79.5   Levels Previous Daily High 85.67 Previous Daily Low 84.24 Previous Weekly High 87.03 Previous Weekly Low 84.01 Previous Monthly High 83.05 Previous Monthly Low 76.5 Daily Fibonacci 38.2% 84.79 Daily Fibonacci 61.8% 85.12 Daily Pivot Point S1 84.12 Daily Pivot Point S2 83.47 Daily Pivot Point S3 82.7 Daily Pivot Point R1 85.55 Daily Pivot Point R2 86.32 Daily Pivot Point R3 86.97    

US Rates Strategists at TD Securities (TDS) express their concerns over ballooning US deficits and their impact on the Treasury market.

US Rates Strategists at TD Securities (TDS) express their concerns over ballooning US deficits and their impact on the Treasury market. Key quotes “While Treasury is likely to hold auction sizes steady starting in May, investors remain concerned about the long-term US deficit trajectory. We believe it would take a combination of stronger economic data and a refocusing of market attention on the deficit outlook to produce a repeat of the 2023-style bear steepening in Treasuries.” “US deficits are on one of the worst trajectories on record and are set to deteriorate further as the 2017 tax cuts are likely to be renewed next year.” “The reinstatement of the debt ceiling in early 2025 should ensure that the budget and debt ceiling are politically coupled once again. Next year's negotiation is likely to be one the most contentious showdowns since 2011, and we see a risk of yet another downgrade to the US credit rating.” “The ongoing rise in deficits and declining dealer balance sheet capacity have led some investors to conclude that the Fed would intervene in markets if liquidity conditions deteriorate sharply. However, we believe the bar for the Fed intervention is quite high, and it would take a true shock for the Fed to step in.” “The Treasury market is likely to remain focused on inflation and growth in the near term. However, rising deficits should continue to push term premium higher, the curve steeper, long-end swap spreads tighter, and keep real rates elevated.”

Gold price (XAU/USD) balances below $2,400 in Wednesday’s European session.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Gold price struggles for a direction as the Fed’s “higher for longer” interest-rates stance offsets safe-haven demand.Fed Powell supports keeping interest rates at high levels until there is confidence that inflation will ease to 2%.The US warns about sanctions on Iran in response to their attack on Israel.Gold price (XAU/USD) balances below $2,400 in Wednesday’s European session. The precious metal struggles to recapture new all-time highs around $2,430 as Federal Reserve (Fed) Chair Jerome Powell emphasised maintaining the restrictive policy framework for a longer period. Powell and his colleagues seem to be leaning towards keeping interest rates higher for longer as inflation has remained stubborn and the labor demand remained strong. The prospects for the Fed keeping interest rates higher for longer bodes well for the US Dollar and US bond yields. 10-year US Treasury yields fell slightly but remained close to a five-month high around 4.70%. The US Dollar Index (DXY), which measures the Greenback’s value against six major currencies, turns sideways after refreshing a five-month high near 106.40. Meanwhile, deepening Middle East tensions hold strong ground for Gold. Israel prepares to respond to Iran’s attack. However, US President Joe Biden said it won’t support the counterattack from Israel. US Treasury Secretary Janet Yellen said on Tuesday that the US administration intends to levy new sanctions on Iran after its attack on Israel. Fresh sanctions on Iran could impact their capacity to export Oil. Daily digest market movers: Gold price struggles for direction Gold price trades below the crucial resistance of $2,400. The precious metal consolidates as a hawkish interest rate outlook from Federal Reserve Chair Jerome Powell has limited the upside while escalating Middle East tensions continue to offer firm ground. On Tuesday, Jerome Powell supported keeping interest rates higher for a longer period as current inflation data is not giving confidence that price pressures will return to the desired rate of 2%. “The recent data have clearly not given us greater confidence, and instead indicate that it’s likely to take longer than expected to achieve that confidence,” Powell said, according to Reuters. Powell added that strong labor demand and slowing disinflation progress in the first three months of this year suggest that the restrictive monetary policy framework should be given more time to work to bring inflation down to 2%. The Fed’s confidence in progress in inflation easing to the required rate of 2% was questioned after the March Consumer Price Index (CPI) data surprisingly rose more than estimated. Also, robust Retail Sales data for March have reinforced expectations that the inflation outlook will remain stubborn. On the geopolitical front, escalating Middle East tensions keep the safe-haven bid firm. Fears of Middle East tensions spreading beyond Gaza have escalated as Israel prepares to retaliate for the airstrike by Iran on their territory on Saturday. Iran aimed hundreds of drones and missiles at Israel in response to their attack on the Iranian embassy near Damascus in Syria, in which two high-ranked generals were killed. The appeal for Gold as a safe-haven asset strengthens when investors see geopolitical tensions worsening further. Meanwhile, Fed policymakers are lined up to provide fresh guidance on interest rates this week. Policymakers are expected to maintain the argument that interest rates need to remain higher for long enough until they get evidence that inflation will sustainably return to the desired rate of 2%. Technical Analysis: Gold price trades below $2,400Gold price trades sideways inside Tuesday’s trading range around $2,380. The upside in the precious metal remains limited as momentum oscillators are cooling down after turning extremely overbought. The 14-period Relative Strength Index (RSI) on the daily chart drops slightly after peaking around 85.00. however, the broader-term demand is intact as the RSI remains in the bullish range of 60.00-80.00.  On the downside, April 5 low near $2,268 and March 21 high at $2,223 will be major support areas. Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.  

USD/CAD retreats from a five-month high of 1.3846 reached on Tuesday.

USD/CAD pulls back from the high level of 1.3846, which has not been seen since mid-November.The US Dollar may strengthen further on the likelihood of the Fed extending its tight monetary policy.The lower WTI price could limit the advance of the Canadian Dollar.USD/CAD retreats from a five-month high of 1.3846 reached on Tuesday. The pair trades around 1.3800 during the European hours on Wednesday. The minor decline in the US Dollar (USD) adds to the downward pressure on the USD/CAD pair. However, the US Dollar Index (DXY) remains close to its five-month peak of 106.51 achieved on Tuesday. At the time of writing, the 2-year and 10-year yields on US Treasury bonds stand at 4.94% and 4.63%, respectively. The hawkish remarks from the Federal Reserve Chair Jerome Powell, could have supported the US Dollar (USD). According to Reuters, Powell remarked that recent data suggests minimal advancement in inflation this year, implying a prolonged period before reaching the 2% target. The lower crude Oil prices weaken the Canadian Dollar (CAD), given that Canada is the largest oil exporter to the United States (US). West Texas Intermediate (WTI) Oil price dips to nearly $84.40 per barrel, at the time of writing. The concerns over Oil supply stemming from heightened tensions in the Middle East have been overshadowed by worries about global demand. Sluggish economic growth in China and the anticipated rise in US commercial stockpiles have heightened concerns regarding the global demand for crude OilThe Canadian inflation data has provided support for the Bank of Canada (BoC) to contemplate easing borrowing conditions in its upcoming June meeting. Particularly, the closely monitored core inflation indicator exhibited signs of sustained moderation, which may influence the BoC's decision-making regarding monetary policy adjustments.Consumer Price Index (CPI) rose by 0.6% MoM, lower than the expected 0.7% in March but higher than the previous increase of 0.3%. Meanwhile, Core CPI (YoY) increased by 2.0% at a slower pace compared to the previous rise of 2.1%. USD/CAD Overview Today last price 1.3807 Today Daily Change -0.0022 Today Daily Change % -0.16 Today daily open 1.3829   Trends Daily SMA20 1.3607 Daily SMA50 1.3551 Daily SMA100 1.3488 Daily SMA200 1.352   Levels Previous Daily High 1.3846 Previous Daily Low 1.3774 Previous Weekly High 1.3787 Previous Weekly Low 1.3547 Previous Monthly High 1.3614 Previous Monthly Low 1.342 Daily Fibonacci 38.2% 1.3819 Daily Fibonacci 61.8% 1.3802 Daily Pivot Point S1 1.3787 Daily Pivot Point S2 1.3744 Daily Pivot Point S3 1.3715 Daily Pivot Point R1 1.3859 Daily Pivot Point R2 1.3888 Daily Pivot Point R3 1.3931    

Silver prices (XAG/USD) rose on Wednesday, according to FXStreet data.

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Silver trades at $28.49 per troy ounce, up 1.37% from the $28.11 it cost on Tuesday. Silver prices have increased by 11.86% since the beginning of the year. Unit measure Today Price Silver price per troy ounce $28.49 Silver price per gram $0.92   The Gold/Silver ratio, which shows the number of troy ounces of Silver needed to equal the value of one troy ounce of Gold, stood at 83.97 on Wednesday, down from 84.77 on Tuesday. Investors might use this ratio to determine the relative valuation of Gold and Silver. Some may consider a high ratio as an indicator that Silver is undervalued – or Gold is overvalued – and might buy Silver or sell Gold accordingly. Conversely, a low ratio might suggest that Gold is undervalued relative to Silver. Global Market Movers: Comex Silver price resumes uptrend as geopolitical risks loom Silver price appreciates as traders adopt caution on expectations of Israel responding to Iran's attack. The decline in the US Dollar (USD) provides support to advance Silver demand. The price of the white metal could struggle as the Fed may adopt a hawkish stance on its monetary tightening. On Tuesday, Federal Reserve Chair Powell remarked that recent data suggests minimal advancement in inflation this year, implying a prolonged period before reaching the 2% target. A stronger US Dollar tends to make silver more expensive to buy for investors using other currencies, which could impact the demand for the white metal.(An automation tool was used in creating this post.)Silver FAQs Why do people invest in Silver? Silver is a precious metal highly traded among investors. It has been historically used as a store of value and a medium of exchange. Although less popular than Gold, traders may turn to Silver to diversify their investment portfolio, for its intrinsic value or as a potential hedge during high-inflation periods. Investors can buy physical Silver, in coins or in bars, or trade it through vehicles such as Exchange Traded Funds, which track its price on international markets. Which factors influence Silver prices? Silver prices can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can make Silver price escalate due to its safe-haven status, although to a lesser extent than Gold's. As a yieldless asset, Silver tends to rise with lower interest rates. Its moves also depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAG/USD). A strong Dollar tends to keep the price of Silver at bay, whereas a weaker Dollar is likely to propel prices up. Other factors such as investment demand, mining supply – Silver is much more abundant than Gold – and recycling rates can also affect prices. How does industrial demand affect Silver prices? Silver is widely used in industry, particularly in sectors such as electronics or solar energy, as it has one of the highest electric conductivity of all metals – more than Copper and Gold. A surge in demand can increase prices, while a decline tends to lower them. Dynamics in the US, Chinese and Indian economies can also contribute to price swings: for the US and particularly China, their big industrial sectors use Silver in various processes; in India, consumers’ demand for the precious metal for jewellery also plays a key role in setting prices. How do Silver prices react to Gold’s moves? Silver prices tend to follow Gold's moves. When Gold prices rise, Silver typically follows suit, as their status as safe-haven assets is similar. The Gold/Silver ratio, which shows the number of ounces of Silver needed to equal the value of one ounce of Gold, may help to determine the relative valuation between both metals. Some investors may consider a high ratio as an indicator that Silver is undervalued, or Gold is overvalued. On the contrary, a low ratio might suggest that Gold is undervalued relative to Silver.  

Eurozone Harmonized Index of Consumer Prices (MoM) in line with expectations (0.8%) in March

Eurozone Core Harmonized Index of Consumer Prices (YoY) meets expectations (2.9%) in March

Eurozone Harmonized Index of Consumer Prices (YoY) in line with expectations (2.4%) in March

Eurozone Core Harmonized Index of Consumer Prices (MoM) remains unchanged at 1.1% in March

Japan’s Chief Cabinet Secretary Yishimasa Hayashi said on Wednesday that we are “closely watching FX moves” and are “prepared for full measures.” Additional quotes Important for currencies to move in a stable manner, reflecting fundamentals.

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United Kingdom DCLG House Price Index (YoY) climbed from previous -0.6% to -0.2% in February

Silver price edges higher to near $28.50 per troy ounce during the European trading hours on Wednesday.

Silver price appreciates as traders adopt caution on expectations of Israel responding to Iran's attack.The decline in the US Dollar provides support to advance Silver demand.The price of the white metal could struggle as the Fed may adopt a hawkish stance on its monetary tightening.Silver price edges higher to near $28.50 per troy ounce during the European trading hours on Wednesday. The safe-haven bullion like Silver gains ground on the market caution. Investors are cautiously monitoring Israel's response to Iran's air strike on Saturday. A Reuters article reported that the rescheduling of the third meeting of Israel's war cabinet, initially slated for Tuesday, has been moved to Wednesday. The purpose of this meeting is to discuss and deliberate on Israel's response to Iran's unprecedented direct attack. Additionally, the mild downward correction in the US Dollar adds to the upside of the Silver demand. However, the US Dollar Index (DXY) maintains a position near its five-month high of 106.51 reached on Tuesday. 2-year and 10-year US yields on US Treasury bonds stand at 4.96% and 4.65%, respectively, by the press time. The expectations of the Federal Reserve (Fed) maintaining elevated interest rates for a longer duration, buoyed by a robust US economy and persistent inflation. Additionally, the hawkish remarks from the Federal Reserve Chair Jerome Powell, could support the US Dollar (USD). A stronger US Dollar (USD) tends to make silver more expensive to buy for investors using other currencies, which could impact the demand for the white metal. On Tuesday, Federal Reserve Chair Powell remarked that recent data suggests minimal advancement in inflation this year, implying a prolonged period before reaching the 2% target. This statement potentially fostered a more hawkish sentiment and lent support to the US Dollar, according to Reuters. XAG/USD Overview Today last price 28.41 Today Daily Change 0.31 Today Daily Change % 1.10 Today daily open 28.1   Trends Daily SMA20 26.44 Daily SMA50 24.58 Daily SMA100 24.03 Daily SMA200 23.65   Levels Previous Daily High 29.02 Previous Daily Low 27.95 Previous Weekly High 29.8 Previous Weekly Low 26.88 Previous Monthly High 25.77 Previous Monthly Low 22.51 Daily Fibonacci 38.2% 28.36 Daily Fibonacci 61.8% 28.61 Daily Pivot Point S1 27.7 Daily Pivot Point S2 27.3 Daily Pivot Point S3 26.64 Daily Pivot Point R1 28.76 Daily Pivot Point R2 29.42 Daily Pivot Point R3 29.82    

South Africa Consumer Price Index (MoM) declined to 0.8% in March from previous 1%

South Africa Consumer Price Index (YoY) down to 5.3% in March from previous 5.6%

EUR/USD trades slightly down on Wednesday in the lower 1.0600s, as it clocks up a sixth consecutive day of losses.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}EUR/USD edges down ahead of HICP inflation data for the Eurozone. Speeches by several key ECB governing council members could also impact EUR/USD. EUR/USD enters oversold levels on the daily chart, indicating risk of a pullback. EUR/USD trades slightly down on Wednesday in the lower 1.0600s, as it clocks up a sixth consecutive day of losses.  The pair is entering the oversold zone on charts, suggesting traders may be operating with more caution. Whilst this does not definitively indicate an end to the downtrend itself, it does up the odds of an upward correction potentially evolving on the horizon.  In terms of volatility, the main events on the calendar for EUR/USD on Wednesday are the final estimates for Eurozone March inflation data, and several speeches by European Central Bank (ECB) officials. EUR/USD: Traders await final estimates, ECB speeches EUR/USD could see some volatility after the release of the final estimates for Eurozone March Inflation data at 9:00 GMT on Wednesday. Levels of inflation inform the decisions of the ECB regarding the setting of interest rates, a key driver in the FX markets. If the revisions deviate from the initial estimates the pair may fluctuate.

Flash estimates for the Harmonized Index of Consumer Prices (HICP) in March, showed a 2.4% rise year-on-year, down from 2.6% previously. The final estimate is also expected to show 2.4%.  The flash estimate for Core HICP showed a 2.9% rise YoY from 3.1% previous, and 0.8% month-on-month from 1.1% in February. Again, in both cases, the final estimate is expected to remain unchanged.   Any deviation in the data, however, is likely to move EUR/USD.  A lower-than-expected final estimate would solidify expectations that the ECB will go ahead and cut interest rates in the near-term, probably in June. Since lower interest rates, or their expectation, tend to reduce foreign capital inflows, such a result would probably depreciate to the Euro (EUR) and push down EUR/USD.  If HICP is revised up, this might raise some doubt about whether the ECB will go ahead with a rate cut in June, which could strengthen the Euro and see EUR/USD recover.  Speeches by key ECB members throughout the day, including ECB Executive Board Member Piero Cipollone, ECB Executive Board Member Isabel Schnabel and President Christine Lagarde herself could also impact the pair’s volatility.  The case for an imminent cut in interest rates – the ECB’s key main refinancing operations rate stands at 4.50% – was strengthened on Tuesday after ECB President Christine Lagarde said that the ECB will cut rates soon, bar a surprise, and that the ECB was keeping a close eye on Oil prices due to tensions in the Middle East.  Technical Analysis: EUR/USD bears are oversoldThe EUR/USD pair is firmly in a downtrend on both its short and medium-term time frames, since peaking and rolling over at 1.1139 in December.  EUR/USD Daily Chart
  The downtrend thesis is supported by the fact that the pair is trading below all its key major moving averages – the 50-day, 100-day and 200-day Simple Moving Averages (SMA).  It is making lower lows and lower highs and this trend is biased to continue – with one caveat.  The Relative Strength Index (RSI) momentum indicator is flashing oversold on the daily chart. At the moment this is only a warning for short-traders not to add to their positions, however, if the RSI were to exit oversold and rise back above 30, it would be a sign the pair was correcting and for short-traders to close their positions and open longs.  As things stand it is still possible the pair could continue lower and even if there is a correction the dominant downtrend is still likely to resume. The next key downside target for the pair is the 2023 lows at 1.0446.  If a pullback evolves, meanwhile, a possible target could be the swing low at 1.0700. Euro FAQs What is the Euro? The Euro is the currency for the 20 European Union countries that belong to the Eurozone. It is the second most heavily traded currency in the world behind the US Dollar. In 2022, it accounted for 31% of all foreign exchange transactions, with an average daily turnover of over $2.2 trillion a day. EUR/USD is the most heavily traded currency pair in the world, accounting for an estimated 30% off all transactions, followed by EUR/JPY (4%), EUR/GBP (3%) and EUR/AUD (2%). What is the ECB and how does it impact the Euro? The European Central Bank (ECB) in Frankfurt, Germany, is the reserve bank for the Eurozone. The ECB sets interest rates and manages monetary policy. The ECB’s primary mandate is to maintain price stability, which means either controlling inflation or stimulating growth. Its primary tool is the raising or lowering of interest rates. Relatively high interest rates – or the expectation of higher rates – will usually benefit the Euro and vice versa. The ECB Governing Council makes monetary policy decisions at meetings held eight times a year. Decisions are made by heads of the Eurozone national banks and six permanent members, including the President of the ECB, Christine Lagarde. How does inflation data impact the value of the Euro? Eurozone inflation data, measured by the Harmonized Index of Consumer Prices (HICP), is an important econometric for the Euro. If inflation rises more than expected, especially if above the ECB’s 2% target, it obliges the ECB to raise interest rates to bring it back under control. Relatively high interest rates compared to its counterparts will usually benefit the Euro, as it makes the region more attractive as a place for global investors to park their money. How does economic data influence the value of the Euro? Data releases gauge the health of the economy and can impact on the Euro. Indicators such as GDP, Manufacturing and Services PMIs, employment, and consumer sentiment surveys can all influence the direction of the single currency. A strong economy is good for the Euro. Not only does it attract more foreign investment but it may encourage the ECB to put up interest rates, which will directly strengthen the Euro. Otherwise, if economic data is weak, the Euro is likely to fall. Economic data for the four largest economies in the euro area (Germany, France, Italy and Spain) are especially significant, as they account for 75% of the Eurozone’s economy. How does the Trade Balance impact the Euro? Another significant data release for the Euro is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought after exports then its currency will gain in value purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.  

USD/JPY trades around 154.60 during the early European session on Wednesday, hovering near its peak at 154.78, a level not seen since June 1990.

USD/JPY maintains its position around the high of 154.78 marked on Tuesday.US Dollar strengthens on expectations of the Fed prolonging higher policy rates for a longer duration.Japan’s Merchandise Trade Balance Total rose to a surplus of ¥366.5 billion in March, from the previous deficit of ¥377.8 billion.USD/JPY trades around 154.60 during the early European session on Wednesday, hovering near its peak at 154.78, a level not seen since June 1990. The downward correction in the US Dollar (USD) puts pressure on the USD/JPY pair. However, expectations of the Federal Reserve (Fed) maintaining elevated interest rates for a longer duration, buoyed by a robust US economy and persistent inflation, counterbalance the downward trend in the USD/JPY pair. Federal Reserve Chair Jerome Powell's remarks on Tuesday at the Washington Forum might have bolstered the greenback. Powell noted that recent data indicates limited progress on inflation this year, suggesting a prolonged period before reaching the 2% target. This commentary possibly contributed to a more hawkish stance and provided support to the US Dollar, as reported by Reuters. On the other side, the Japanese Yen (JPY) might have found support from the country's trade balance swinging to a surplus in March. The Merchandise Trade Balance Total improved to ¥366.5 billion from the previous deficit of ¥377.8 billion. Additionally, a private survey revealed that sentiment among manufacturers in Japan softened in April due to a weaker Yen driving up import expenses. Furthermore, the Japanese Yen could see bolstering from safe-haven inflows, likely prompted by risk aversion. Investors are cautiously monitoring Israel's response to Iran's air strike on Saturday. A Reuters report mentioned the postponement of a third meeting of Israel's war cabinet, initially scheduled for Tuesday, to Wednesday, to deliberate on a reaction to Iran's unprecedented direct attack. Traders eagerly await the release of Japan's National Consumer Price Index (CPI) data by the Statistics Bureau of Japan on Friday. Market expectations point towards a moderation in Consumer Prices in March. USD/JPY Overview Today last price 154.59 Today Daily Change -0.13 Today Daily Change % -0.08 Today daily open 154.72   Trends Daily SMA20 152.08 Daily SMA50 150.54 Daily SMA100 147.94 Daily SMA200 147.42   Levels Previous Daily High 154.79 Previous Daily Low 153.9 Previous Weekly High 153.39 Previous Weekly Low 151.57 Previous Monthly High 151.97 Previous Monthly Low 146.48 Daily Fibonacci 38.2% 154.45 Daily Fibonacci 61.8% 154.24 Daily Pivot Point S1 154.15 Daily Pivot Point S2 153.58 Daily Pivot Point S3 153.27 Daily Pivot Point R1 155.04 Daily Pivot Point R2 155.36 Daily Pivot Point R3 155.93    

The Pound Sterling (GBP) rebounds strongly in Wednesday’s London session as the United Kingdom Office for National Statistics (ONS) reported that the Consumer Price Index (CPI) for March grew more than what economists had expected.

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Despite beating estimates, inflation has softened from February, suggesting that higher interest rates by the Bank of England (BoE) contribute to abate price pressures.  Meanwhile, producer price inflation has also slowed, indicating prices of goods and services at factory gates are easing. Business owners generally slash their prices when they expect demand to remain subdued. Slightly hot inflation figures could put into question expectations that the BoE will cut rates in August, although Tuesday’s employment data suggested that the UK’s job market is cooling. The labor market report showed that the Unemployment Rate rose sharply to 4.2% in three months ending February from expectations of 4.0% and the prior release of 3.9%. The number of employed people fell by 156K in the three months to February, more than the 89K jobs lost in the quarter to January.  Daily digest market movers: Pound Sterling recovers even as US Dollar remains firm The Pound Sterling bounces back to 1.2460 as the United Kingdom ONS reports higher-than-expected inflation rate for March. Annual headline inflation rose 3.2%, higher than expectations of 3.1% but slowing from the prior reading of 3.4%. Monthly headline inflation grew steadily by 0.6%. UK’s annual core CPI data, which strips off volatile food and energy prices, grew by 4.2%, more than the 4.1% expected, but significantly decelerating from February’s reading of 4.5%. The core inflation data is the Bank of England’s preferred inflation measure for decision-making on interest rates. even as the measure came in slightly higher than expected, it clearly shows that price pressures are on course to return to BoE’s desired rate of 2%. March’s inflation data is unlikely to significantly influence speculation for the BoE pivoting to rate cuts, which financial markets are currently expecting from November, according to rate future markets, Reuters reports.  On the global front, dismal market sentiment due to worsening Middle East tensions and a hawkish interest rate guidance from Federal Reserve Chair Jerome Powell has been maintaining downward pressure on risk-sensitive assets. S&P 500 futures are posting some losses.  Fears of further escalation in Iran-Israel tensions have deepened as Israel vowed to retaliate against Iran’s attack. The US said it is prepared to impose sanctions on Iran. The US Dollar Index (DXY), which measures the US Dollar’s value against six major currencies, hovers near a fresh five-month high around 106.40. The USD Index is expected to extend its upside as Fed Powell said on Tuesday that there is a need to hold interest rates higher for longer given strong labor demand and slowed progress in inflation declining to the desired rate of 2%. Technical Analysis: Pound Sterling finds cushion near 1.2400 The Pound Sterling exhibits a firm footing after the release of the UK inflation report for March. The GBP/USD pair sees strong buying near the crucial support at 1.2400. The upside in the Cable is seen limited near the psychological resistance of 1.2500. This coincides with the breakdown region of the Head and Shoulder chart formation on the daily time frame.  The long-term outlook turns bearish as the Cable drops below the 200-day Exponential Moving Average (EMA), which trades around 1.2560. The 14-period Relative Strength Index (RSI) shifts into the bearish range of 20.00-40.00, suggesting an active downside momentum. Pound Sterling FAQs What is the Pound Sterling? The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data. Its key trading pairs are GBP/USD, aka ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE). How do the decisions of the Bank of England impact on the Pound Sterling? The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates. When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money. When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects. How does economic data influence the value of the Pound? Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP. A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall. How does the Trade Balance impact the Pound? Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period. If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.

The USD/CHF pair faces some selling pressure to 0.9105 on Wednesday during the early European session.

USD/CHF edges lower to 0.9105 amid the softer USD on Wednesday. The uncertainties and escalating tensions in the Middle East might benefit the Swiss Franc (CHF). Fed’s Powell stated that monetary policy needs to be restrictive for longer, triggering the hope of delaying interest rate cuts. The USD/CHF pair faces some selling pressure to 0.9105 on Wednesday during the early European session. The downtick of the pair is supported by the decline of the US Dollar Index (DXY) to 106.20. Additionally, the ongoing geopolitical tensions in the Middle East continue to support the Swiss Franc (CHF), a traditional safe-haven currency. 

Late Tuesday, National Security Advisor Jake Sullivan said that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. Sullivan added that these new measures will "continue a steady drumbeat of pressure" to contain and degrade Iran's military capacity and effectiveness and confront the full range of its problematic behaviors. Meanwhile, western leaders have urged Israel to exercise restraint against escalation. Market players will closely monitor the development surrounding Israel and Iran tensions. Any escalating tensions might boost safe-haven assets like CHF and create a headwind for the USD/CHF pair. 

On the other hand, strong US economic data and hawkish comments from the US central bank remain to support the Greenback for the time being. The Federal Reserve's Jerome Powell stated that the US economy has not seen inflation come back to the 2% target and that monetary policy needs to be restrictive for longer. These remarks further dampen investors' hopes for meaningful rate cuts this year and lift the USD against its rivals. According to the CME FedWatch Tool, financial markets have priced in 67% odds that the Fed will cut interest rates in September.  USD/CHF Overview Today last price 0.9102 Today Daily Change -0.0028 Today Daily Change % -0.31 Today daily open 0.913   Trends Daily SMA20 0.9041 Daily SMA50 0.8901 Daily SMA100 0.8761 Daily SMA200 0.8827   Levels Previous Daily High 0.9142 Previous Daily Low 0.9112 Previous Weekly High 0.9148 Previous Weekly Low 0.9012 Previous Monthly High 0.9072 Previous Monthly Low 0.873 Daily Fibonacci 38.2% 0.9131 Daily Fibonacci 61.8% 0.9123 Daily Pivot Point S1 0.9113 Daily Pivot Point S2 0.9097 Daily Pivot Point S3 0.9083 Daily Pivot Point R1 0.9144 Daily Pivot Point R2 0.9159 Daily Pivot Point R3 0.9175    

Austria HICP (MoM) in line with forecasts (0.7%) in March

Austria HICP (YoY) registered at 4.1%, below expectations (4.2%) in March

Turkey Current Account Balance declined to $-3.265B in February from previous $-2.556B

Here is what you need to know on Wednesday, April 17: The US Dollar holds steady against its major rivals after ending Tuesday on a bullish note.

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The US economic docket will not offer any high-impact data releases but several Federal Reserve (Fed) policymakers will be delivering speeches on Wednesday. Eurostat will release revisions to March inflation data during the European trading hours. US Dollar price this week The table below shows the percentage change of US Dollar (USD) against listed major currencies this week. US Dollar was the strongest against the Australian Dollar.  USDEURGBPCADAUDJPYNZDCHFUSD  0.21% -0.05% 0.42% 0.84% 0.80% 0.65% -0.20%EUR-0.21%   -0.27% 0.22% 0.63% 0.60% 0.45% -0.43%GBP0.05% 0.27%   0.49% 0.92% 0.86% 0.71% -0.17%CAD-0.43% -0.22% -0.49%   0.41% 0.38% 0.22% -0.64%AUD-0.83% -0.63% -0.90% -0.40%   -0.02% -0.18% -1.04%JPY-0.79% -0.59% -0.84% -0.38% 0.03%   -0.13% -1.03%NZD-0.64% -0.43% -0.71% -0.21% 0.20% 0.17%   -0.86%CHF0.21% 0.42% 0.16% 0.64% 1.04% 1.01% 0.85%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote).   The UK's Office for National Statistics reported early Wednesday that annual inflation, as measured by the change in the Consumer Price Index (CPI), edged lower to 3.2% in March from 3.4% in February. Additionally, core CPI rose 4.2% in the same period. Both of these readings came in above analysts' estimates and helped Pound Sterling gather strength. After spending the Asian session in a tight channel slightly above 1.2400, GBP/USD gained traction and rose toward 1.2450.UK CPI inflation cools down to 3.2% in March vs. 3.1% estimate.Hawkish comments from Fed officials and the cautious market stance helped the USD find demand in the American session and the USD Index closed the fifth consecutive day in positive territory on Tuesday. Early Wednesday, the benchmark 10-year US Treasury bond yield moves sideways above 4.65% and US stock index futures trade marginally lower. Israel said that it will retaliate against Iran and a war cabinet meeting to decide on the appropriate response will be reportedly held on Wednesday.EUR/USD recovered modestly after falling toward 1.0600 on Tuesday and closed the day virtually unchanged. The pair stays relatively quiet and moves up and down in a narrow band above 1.0600 in the European morning.Gold failed to make a decisive move in either direction on Tuesday as rising US Treasury bond yields made it difficult for the precious metal to benefit from the cautious market mood. XAU/USD continues to move sideways above $2,370 early Wednesday.Gold Price Forecast: XAU/USD remains steady above $2,350 amid market caution.The data from New Zealand showed in the early Asian session on Wednesday that the CPI rose 4% on a yearly basis in the first quarter, down sharply from the 4.7% increase recorded in the previous quarter. On a quarterly basis, the CPI was up 0.6%. NZD/USD stretched higher after this report and was last seen trading in positive territory slightly above 0.5900.USD/JPY touched a yet another multi-decade high near 154.80 on Tuesday. The pair retreated slightly in the Asian session and seems to have stabilized at around 154.50. Central banks FAQs What does a central bank do? Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%. What does a central bank do when inflation undershoots or overshoots its projected target? A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing. Who decides on monetary policy and interest rates? A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%. Is there a president or head of a central bank? Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.  

EUR/GBP faces downward pressure following mixed Consumer Price Index (CPI) data from the United Kingdom (UK).

EUR/GBP moves negatively after paring intraday gains amid mixed UK inflation figures.UK CPI MoM remained stable at a 0.6% increase in March, while the YoY index rose by 3.2%, exceeding expectations.Traders shift their focus on the Eurozone Harmonized Index of Consumer Prices, set to be released Wednesday.EUR/GBP faces downward pressure following mixed Consumer Price Index (CPI) data from the United Kingdom (UK). The EUR/GBP pair dips to near 0.8540 during the Asian session on Wednesday. Market attention now turns to the Eurozone Harmonized Index of Consumer Prices (HICP) for March, set to be released later in the day. In March, UK CPI (MoM) maintained a steady pace of 0.6%, while year-over-year Consumer Inflation increased by 3.2%, slightly above the expectations of 3.1% but lower than the previous 3.4%. Meanwhile, Core CPI YoY rose by 4.2%, surpassing expectations of 4.1% but lower than the previous 4.5%. The Pound Sterling (GBP) faces downward pressure as investors anticipate two rate cuts by the Bank of England (BoE) this year, with the initial move likely in August or September. BoE Governor Andrew Bailey stated on Tuesday that there is compelling evidence indicating a decline in UK inflation. The key question for BoE policymakers, according to Bailey, is how much additional evidence is needed before considering interest rate cuts. On the other side, the Euro faces challenges amid growing speculation that the European Central Bank (ECB) will commence interest rate cuts in June, driven by a tepid Eurozone economic outlook and moderating core inflationary pressures. During an interview with CNBC on Tuesday, ECB President Christine Lagarde suggested that rate cuts are imminent, barring any significant unforeseen developments. Lagarde remarked that the ECB is observing a disinflationary trend that aligns with expectations. Additionally, she noted that geopolitical events' influence on commodity prices has been relatively limited thus far. EUR/GBP Overview Today last price 0.8534 Today Daily Change -0.0011 Today Daily Change % -0.13 Today daily open 0.8545   Trends Daily SMA20 0.8561 Daily SMA50 0.8552 Daily SMA100 0.8575 Daily SMA200 0.8607   Levels Previous Daily High 0.855 Previous Daily Low 0.8528 Previous Weekly High 0.8584 Previous Weekly Low 0.8528 Previous Monthly High 0.8602 Previous Monthly Low 0.8504 Daily Fibonacci 38.2% 0.8542 Daily Fibonacci 61.8% 0.8537 Daily Pivot Point S1 0.8532 Daily Pivot Point S2 0.8519 Daily Pivot Point S3 0.851 Daily Pivot Point R1 0.8554 Daily Pivot Point R2 0.8563 Daily Pivot Point R3 0.8576    

The GBP/JPY pair snaps the two-day winning streak around 192.20 during the early European session on Wednesday.

GBP/JPY holds positive ground near 192.20 after the release of the UK inflation report. UK CPI rose 3.2% YoY in March vs. 3.1% expected. The BoJ’s cautious stance weighs on the Japanese Yen (JPY) against the GBP. The GBP/JPY pair snaps the two-day winning streak around 192.20 during the early European session on Wednesday. The Pound Sterling (GBP) edges higher to an intraday high of 192.40 and then retreats following the hotter-than-expected UK Inflation data. 

The headline annual UK Consumer Price Index rose 3.2% in March, softer than a 3.4% increase in February. This reading came in above the market consensus of 3.1%, but still higher than the BoE’s 2.0% target, according to the Office for National Statistics on Wednesday. Furthermore, the core CPI inflation dropped to 4.2% YoY in March from 4.5% in February. Meanwhile, the UK monthly CPI rose 0.6% in March, the same pace seen in February. The GBP gains traction as investors push back market expectations of a September BoE rate cut. 

On the Japanese Yen front, the Bank of Japan (BoJ) has been cautious in normalizing its policy. Japanese CPI inflation is expected to remain above 2% through fiscal year 2024 and decelerate in fiscal year 2025, according to the BoJ’s quarterly outlook report. This triggers the anticipation that interest rates will remain extremely low for some time, which weighs on the Japanese Yen (JPY). Investors will monitor the fresh quarterly growth and price projections due at its April 25–26 policy meeting for any hints about the path of interest rate.  GBP/JPY Overview Today last price 192.08 Today Daily Change -0.18 Today Daily Change % -0.09 Today daily open 192.26   Trends Daily SMA20 191.61 Daily SMA50 190.42 Daily SMA100 187.34 Daily SMA200 185.39   Levels Previous Daily High 192.82 Previous Daily Low 191.65 Previous Weekly High 193.02 Previous Weekly Low 190 Previous Monthly High 193.54 Previous Monthly Low 187.96 Daily Fibonacci 38.2% 192.37 Daily Fibonacci 61.8% 192.1 Daily Pivot Point S1 191.67 Daily Pivot Point S2 191.08 Daily Pivot Point S3 190.51 Daily Pivot Point R1 192.84 Daily Pivot Point R2 193.41 Daily Pivot Point R3 194    

United Kingdom Retail Price Index (MoM) declined to 0.5% in March from previous 0.8%

United Kingdom Producer Price Index - Output (YoY) n.s.a rose from previous 0.4% to 0.6% in March

United Kingdom Producer Price Index - Input (MoM) n.s.a came in at -0.1% below forecasts (0.1%) in March

United Kingdom Retail Price Index (YoY) registered at 4.3% above expectations (4.2%) in March

United Kingdom Consumer Price Index (YoY) came in at 3.2%, above forecasts (3.1%) in March

United Kingdom Core Consumer Price Index (YoY) above forecasts (4.1%) in March: Actual (4.2%)

United Kingdom Producer Price Index - Output (MoM) n.s.a in line with expectations (0.2%) in March

United Kingdom Consumer Price Index (MoM) unchanged at 0.6% in March

United Kingdom PPI Core Output (MoM) n.s.a up to 0.3% in March from previous 0.2%

United Kingdom Producer Price Index - Input (YoY) n.s.a up to -2.5% in March from previous -2.7%

United Kingdom PPI Core Output (YoY) n.s.a came in at 0.1% below forecasts (0.2%) in March

The EUR/USD pair posts modest gains around 1.0625 after bouncing off the fresh yearly low of 1.0600 on Wednesday during the early European trading hours.

EUR/USD rebounds to 1.0625 in Wednesday’s early European session. The pair keeps the negative outlook unchanged below the key EMA; RSI indicator holds in bearish territory.The initial support level is seen at the 1.0600–1.0605 zone; the immediate resistance level will emerge at 1.0710.The EUR/USD pair posts modest gains around 1.0625 after bouncing off the fresh yearly low of 1.0600 on Wednesday during the early European trading hours. However, the further upside might be limited amid the hawkish comments from Federal Reserve (Fed) Chairman Jerome Powell and growing speculation that the European Central Bank (ECB) will start lowering interest rates in June. Investors await the Eurozone Harmonized Index of Consumer Prices (HICP) for March and ECB President Lagarde's speech for fresh catalysts. 

Technically, EUR/USD maintains the bearish stance unchanged as the major pair is below the key 100-period Exponential Moving Average (EMA) on the four-hour chart. The downward momentum is backed by the Relative Strength Index (RSI), which holds in bearish territory around 32, indicating that further downside looks favorable. 

The 1.0600–1.0605 region acts as an initial support level for the major pair, portraying the confluence of the lower limit of the Bollinger Band and psychological level. Further south, the next contention level to watch is a low of November 2 at 1.0565, followed by the 1.0500 round mark. 

On the upside, the immediate resistance level of EUR/USD will emerge near the 50-period EMA at 1.0710. The additional upside filter to watch is the 100-period EMA at 1.0756. A decisive break above this level will expose a low of March 22 and the round figure at 1.0800, en route to a high of April 9 at 1.0885. EUR/USD four-hour chartEUR/USD Overview Today last price 1.0625 Today Daily Change 0.0006 Today Daily Change % 0.06 Today daily open 1.0619   Trends Daily SMA20 1.0788 Daily SMA50 1.0818 Daily SMA100 1.086 Daily SMA200 1.0826   Levels Previous Daily High 1.0654 Previous Daily Low 1.0601 Previous Weekly High 1.0885 Previous Weekly Low 1.0622 Previous Monthly High 1.0981 Previous Monthly Low 1.0768 Daily Fibonacci 38.2% 1.0621 Daily Fibonacci 61.8% 1.0634 Daily Pivot Point S1 1.0595 Daily Pivot Point S2 1.0572 Daily Pivot Point S3 1.0543 Daily Pivot Point R1 1.0648 Daily Pivot Point R2 1.0677 Daily Pivot Point R3 1.07    

FX option expiries for Apr 17 NY cut at 10:00 Eastern Time, via DTCC, can be found below - EUR/USD: EUR amounts 1.0550 445m 1.0605 630m 1.0630 1.3b 1.0635 455m 1.0650 483m 1.0700 2.1b - GBP/USD: GBP amounts 1.2500 938m - USD/JPY: USD amounts 153.00 936m 153.50 722m - USD/CHF: USD amounts 0.9100 1.2b - AUD/USD: AUD amounts 0.6470 1b - USD/CAD: USD amounts 1.3800 1.5b - NZD/USD: NZD amounts 0.5900 1b - EUR/GBP: EUR amounts 0.8480 429m .

FX option expiries for Apr 17 NY cut at 10:00 Eastern Time, via DTCC, can be found below - EUR/USD: EUR amounts 1.0550 445m 1.0605 630m 1.0630 1.3b 1.0635 455m 1.0650 483m 1.0700 2.1b - GBP/USD: GBP amounts      1.2500 938m - USD/JPY: USD amounts                      153.00 936m 153.50 722m - USD/CHF: USD amounts      0.9100 1.2b - AUD/USD: AUD amounts 0.6470 1b - USD/CAD: USD amounts        1.3800 1.5b - NZD/USD: NZD amounts 0.5900 1b - EUR/GBP: EUR amounts         0.8480 429m

Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $84.25 on Wednesday.

WTI drifts lower to $84.25 on the hawkish Fed remarks on Wednesday.The possibility that the Fed will delay the interest rate cut weighs on the black gold. The Middle East geopolitical tension and higher China's crude oil imports boost WTI prices. Western Texas Intermediate (WTI), the US crude oil benchmark, is trading around $84.25 on Wednesday. The black gold edges lower on the day as hawkish comments from Federal Reserve (Fed) Chairman Jerome Powell offset the escalating geopolitical tensions in the Middle East. 

Investors place lower bets on the Fed rate cuts this year as the US economy remains robust and inflation is still elevated. The Fed Chair Jerome Powell said Tuesday that it will take "longer than expected" to achieve the confidence needed to bring inflation to the central bank’s 2% target. It's worth noting that the higher-for-longer US interest rate narrative may put some selling pressure on WTI prices since it translates to less demand for oil as the cost of holding crude oil rises. 

Furthermore, Crude oil stockpiles in the United States for the week ending April 12 increased by 4.09 million barrels from a build of 3.03 million barrels in the previous week. The market consensus estimated that stocks would rise by about 600,000 barrels, according to the American Petroleum Institute on Tuesday.

The ongoing geopolitical tension in the Middle East continues to boost WTI prices. National Security Advisor Jake Sullivan said in a statement late Tuesday that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. In case of further escalation, $100 oil is possible, Citigroup analysts said. 

Apart from this, China's crude oil imports reached a new high in 2023, jumping by 10% YoY and shattering the previous record set in 2020. This benefits black gold, as China is the world's largest crude oil importer.  WTI US OIL Overview Today last price 84.31 Today Daily Change -0.47 Today Daily Change % -0.55 Today daily open 84.78   Trends Daily SMA20 83.76 Daily SMA50 80.2 Daily SMA100 76.76 Daily SMA200 79.5   Levels Previous Daily High 85.67 Previous Daily Low 84.24 Previous Weekly High 87.03 Previous Weekly Low 84.01 Previous Monthly High 83.05 Previous Monthly Low 76.5 Daily Fibonacci 38.2% 84.79 Daily Fibonacci 61.8% 85.12 Daily Pivot Point S1 84.12 Daily Pivot Point S2 83.47 Daily Pivot Point S3 82.7 Daily Pivot Point R1 85.55 Daily Pivot Point R2 86.32 Daily Pivot Point R3 86.97    

Gold price holds ground near $2,380 per troy ounce on Wednesday, hovering close to record highs as traders exercise caution ahead of Israel's response to Iran's air strike on Saturday.

Gold price hovers close to record highs amid market caution ahead of Israel's response to Iran's assault.Israel's third meeting of the war cabinet, initially scheduled for Tuesday, was postponed until Wednesday.Gold demand may encounter hurdles as Fed Chair Powell emphasized that reaching the 2% inflation target will require more time than previously expected.Gold price holds ground near $2,380 per troy ounce on Wednesday, hovering close to record highs as traders exercise caution ahead of Israel's response to Iran's air strike on Saturday. A Reuters report indicated that a third meeting of Israel's war cabinet, initially scheduled for Tuesday to decide on a reaction to Iran's unprecedented direct attack, was postponed until Wednesday. Furthermore, sources cited by The Jerusalem Post disclosed that Israel has purportedly finalized plans for a counterstrike against Iran. US National Security Advisor Jake Sullivan announced late on Tuesday that new sanctions targeting Iran, alongside sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry, will be enforced in the coming days. Meanwhile, Federal Reserve (Fed) Chairman Jerome Powell, speaking at the Wilson Center in Washington on Tuesday, tempered expectations for rate cuts. Powell noted that the US economy has shown significant strength and recent data indicates a lack of substantial progress on inflation this year. He emphasized that achieving the 2% inflation target will take "longer than expected." The prospect of higher interest rates typically reduces the appeal of non-yielding assets such as Gold. According to the CME FedWatch Tool, the likelihood of interest rates remaining unchanged in the June meeting has risen to 84.8% from Monday’s 78.7%. Investors will closely monitor speeches from Federal Reserve officials this week, as well as Thursday's US Initial Jobless Claims, for further insight into the direction of monetary policy. XAU/USD Overview Today last price 2381.98 Today Daily Change -0.36 Today Daily Change % -0.02 Today daily open 2382.34   Trends Daily SMA20 2271.69 Daily SMA50 2153.19 Daily SMA100 2093.83 Daily SMA200 2014.08   Levels Previous Daily High 2398.29 Previous Daily Low 2363.1 Previous Weekly High 2431.61 Previous Weekly Low 2303.02 Previous Monthly High 2236.27 Previous Monthly Low 2039.12 Daily Fibonacci 38.2% 2376.54 Daily Fibonacci 61.8% 2384.85 Daily Pivot Point S1 2364.2 Daily Pivot Point S2 2346.05 Daily Pivot Point S3 2329.01 Daily Pivot Point R1 2399.39 Daily Pivot Point R2 2416.43 Daily Pivot Point R3 2434.58    

Following the conclusion of the fourth meeting of the Financial Working Group between China and the US in Washington on Wednesday, the Chinese Finance Ministry said that China expressed concern over the US economic and trade restrictions against China and made further responses on the issue of production capacity.

Following the conclusion of the fourth meeting of the Financial Working Group between China and the US in Washington on Wednesday, the Chinese Finance Ministry said that China expressed concern over the US economic and trade restrictions against China and made further responses on the issue of production capacity. Meanwhile, the People’s Bank of China (PBOC) said that “both sides conducted professional, pragmatic, candid and constructive communication on monetary policy and financial stability, financial regulatory cooperation.”

The Reserve Bank of New Zealand (RBNZ) released its Sectoral Factor Model Inflation gauge for the first quarter of 2024 after the publication of the official Consumer Price Index (CPI) by the NZ Stats early Wednesday.

The Reserve Bank of New Zealand (RBNZ) released its Sectoral Factor Model Inflation gauge for the first quarter of 2024 after the publication of the official Consumer Price Index (CPI) by the NZ Stats early Wednesday. The inflation measure rose 4.3% YoY in Q1 2024 vs. 4.7% in Q4 2023.The inflation measures are closely watched by the RBNZ, which has a monetary policy goal of achieving 1% to 3% inflation. FX implications The Kiwi Dollar holds its bounce above 0.5900 after the RBNZ’s inflation data. At the time of writing, NZD/USD is adding 0.47% on the day to trade at 0.5906. About the RBNZ Sectoral Factor Model Inflation The Reserve Bank of New Zealand has a set of models that produce core inflation estimates. The sectoral factor model estimates a measure of core inflation based on co-movements - the extent to which individual price series move together. It takes a sectoral approach, estimating core inflation based on two sets of prices: prices of tradable items, which are those either imported or exposed to international competition, and prices of non-tradable items, which are those produced domestically and not facing competition from imports.

USD/CAD snaps its five-day winning streak, trading around 1.3820 during the Asian session on Wednesday.

USD/CAD retreats from a five-month high of 1.3846 reached on Tuesday.The decline in crude Oil prices might have contributed to undermining the Canadian Dollar.Fed Chair Powell highlighted that recent data indicates the timeframe for achieving the 2% inflation target will be longer than initially anticipated.USD/CAD snaps its five-day winning streak, trading around 1.3820 during the Asian session on Wednesday. The mild correction in the US Dollar (USD) contributes to downward pressure on the USD/CAD pair. However, the weaker crude Oil prices could put pressure on the Canadian Dollar (CAD), consequently, limiting the losses of the pair. The latest Canadian inflation figures provided support for the Bank of Canada (BoC) to consider easing borrowing conditions in its June meeting, as the closely monitored core inflation showed signs of sustained easing.Consumer Price Index (CPI) increased by 0.6% month-over-month, slightly below the expected 0.7% in March but higher than the previous increase of 0.3%. CPI (YoY) rose by 2.9% against 2.8% prior. Meanwhile, Core CPI (YoY) rose by 2.0% at a slower pace compared to the previous 2.1% rise. The monthly Core index showed an increase of 0.5%, higher than the previous 0.1%. On the other side, hawkish remarks from Federal Reserve (Fed) officials and the influx of safe-haven flows could bolster the US Dollar (USD) and potentially limit the downside of the USD/CAD pair. The US Dollar Index (DXY) pulls back from a five-month high of 106.51 reached on Tuesday. This decline could be attributed to a slight decline in US Treasury yields. Federal Reserve (Fed) Chairman Jerome Powell remarked on Tuesday that the US economy has exhibited notable strength. However, Powell also noted that recent data suggests insufficient progress on inflation this year, and achieving the confidence that inflation will reach the 2% target will take "longer than expected." This hawkish stance by Powell might have lent some support to the US Dollar. USD/CAD Overview Today last price 1.3814 Today Daily Change -0.0015 Today Daily Change % -0.11 Today daily open 1.3829   Trends Daily SMA20 1.3607 Daily SMA50 1.3551 Daily SMA100 1.3488 Daily SMA200 1.352   Levels Previous Daily High 1.3846 Previous Daily Low 1.3774 Previous Weekly High 1.3787 Previous Weekly Low 1.3547 Previous Monthly High 1.3614 Previous Monthly Low 1.342 Daily Fibonacci 38.2% 1.3819 Daily Fibonacci 61.8% 1.3802 Daily Pivot Point S1 1.3787 Daily Pivot Point S2 1.3744 Daily Pivot Point S3 1.3715 Daily Pivot Point R1 1.3859 Daily Pivot Point R2 1.3888 Daily Pivot Point R3 1.3931    

The NZD/USD pair rebounds to 0.5905, bouncing off the yearly low of 0.5860 on Wednesday during the early Asian session.

NZD/USD pair holds positive ground around 0.5905 following New Zealand inflation data. The New Zealand CPI inflation rose to 0.6% QoQ in Q1 from 0.5% in the previous reading, as expected. Powell said recent data have not given Fed greater confidence, likely to take longer than expected to achieve its target. The NZD/USD pair rebounds to 0.5905, bouncing off the yearly low of 0.5860 on Wednesday during the early Asian session. The expectation that the Reserve Bank of New Zealand is unlikely to lower its Official Cash Rate (OCR) soon lift the New Zealand Dollar (NZD) against the US Dollar (USD). 

The annual rate of inflation in New Zealand has continued to fall, according to figures released by Stats NZ today. The Consumer Price Index (CPI) rose 4.0% YoY in the first quarter of 2024. Stats NZ’s consumer prices senior manager Nicola Growden said, "Price increases this quarter are the smallest since June 2021. However, they remain above the Reserve Bank of New Zealand’s target range of 1 to 3 percent,”  

Inflationary pressures in New Zealand eased further in the March quarter, although domestic prices remained uncomfortably sticky, keeping rate cuts by the Reserve Bank of New Zealand unlikely to happen soon. This, in turn, provides some support to the NZD. 

On the USD’s front, the hawkish comments from Federal Reserve (Fed) Jerome Powell might lift the US Dollar (USD) in the near term. Fed Chair Powell stated that the US economy has not seen inflation come back to the central bank’s target, suggesting that interest rate cuts are unlikely to be seen in the near future. Investors see a nearly 67% chance that the Fed will cut interest rates in September, according to the CME FedWatch Tool. 

Furthermore, the safe-haven flows amid the rising geopolitical tensions in the Middle East might boost the Greenback and cap the upside of the NZD/USD pair. National Security Advisor Jake Sullivan said in a statement late Tuesday that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. NZD/USD Overview Today last price 0.5906 Today Daily Change 0.0026 Today Daily Change % 0.44 Today daily open 0.588   Trends Daily SMA20 0.5993 Daily SMA50 0.6075 Daily SMA100 0.6132 Daily SMA200 0.6062   Levels Previous Daily High 0.5908 Previous Daily Low 0.5868 Previous Weekly High 0.6079 Previous Weekly Low 0.5933 Previous Monthly High 0.6218 Previous Monthly Low 0.5956 Daily Fibonacci 38.2% 0.5884 Daily Fibonacci 61.8% 0.5893 Daily Pivot Point S1 0.5863 Daily Pivot Point S2 0.5846 Daily Pivot Point S3 0.5823 Daily Pivot Point R1 0.5902 Daily Pivot Point R2 0.5925 Daily Pivot Point R3 0.5942    

The highly-anticipated United Kingdom’s (UK) Consumer Price Index (CPI) data will be published by the Office for National Statistics (ONS) at 06:00 GMT on Wednesday.

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50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}The March UK CPI report will be released by the Office for National Statistics on Wednesday.United Kingdom’s headline and core annual inflation are set to ease in March.The UK CPI report could hint at the BoE’s interest rate cut, rocking the Pound Sterling.The highly-anticipated United Kingdom’s (UK) Consumer Price Index (CPI) data will be published by the Office for National Statistics (ONS) at 06:00 GMT on Wednesday. Pound Sterling could witness a big reaction to the UK CPI inflation report, as the data could prompt the Bank of England (BoE) to signal an interest rate cut earlier than the market expectations. What to expect from the next UK inflation report? The headline annual UK Consumer Price Index is set to rise 3.1% in March, slower than a 3.4% increase in February. The reading would remain at its lowest since September 2021 but still higher than the BoE’s 2.0% target. The core CPI inflation is seen easing to 4.1% YoY in March from 4.5% in February, also reaching the lowest level in more than two years. Meanwhile, the British monthly CPI rose 0.6% in the previous month. A main factor that could contribute to easing inflation is weaker growth in food prices. The latest monitor from the British Retail Consortium (BRC) trade body and the market research firm NielsenIQ showed earlier this month that food inflation fell to 3.7% from 5.0%. Meanwhile, the UK shop prices rose at an annual rate of 1.3% in March, down from a rate of 2.5% in February, registering the slowest pace since December 2021. Helen Dickinson, the chief executive of the BRC, explained the reason behind the fall in food price inflation by saying that “while Easter treats were more expensive than in previous years due to high global cocoa and sugar prices, retailers provided cracking deals on popular chocolates, which led to price falls compared to the previous month.” “Dairy prices also fell on the month as farm gate prices eased, and retailers worked hard to lower prices for many essentials. In non-food, prices of electricals, clothing and footwear fell as retailers increased promotions to entice consumer spending,” she added. Furthermore, Average Earnings excluding Bonus, a measure of wage inflation, rose 6.0% 3M YoY in February, slowing from January’s 6.1% growth.  However, economists expect services inflation to remain elevated at 5.8% YoY even though slowing from a 6.1% increase in February. This could hold the Bank of England (BoE) from signaling a policy pivot. Markets are pricing in the first BoE full quarter-point rate reduction by September. Money markets now wager a 49 basis points (bps) of easing in 2024. The BoE delivered a dovish hold at its March policy meeting after two of the Bank’s most ardent hawks dropped their demands for hikes. BoE Monetary Policy Committee (MPC) members Catherine Mann and Jonathan Haskel joined an 8-1 majority to keep rates at a 16-year high of 5.25%. Previewing the UK inflation data, analysts at TD Securities (TDS) noted that “headline inflation likely continued to slightly undershoot the MPC's forecast in March, though services should be in line at 5.8%.” “Weak food and core goods inflation will exert further downside pressure on the print, while the early Easter adds some upside risk to services. Looking ahead, we continue to expect headline to be below target from April until the end of the year,” the TDS analysts said. When will the UK Consumer Price Index report be released and how could it affect GBP/USD? The UK docket will feature the CPI data on Wednesday at 06:00 GMT. The Pound Sterling is attempting a tepid recovery against the US Dollar heading into the inflation showdown. At the same time, the US Dollar Index consolidates near five-month highs, above 106.00. A hotter-than-expected headline and core inflation data could help push back the market expectations of a September BoE rate cut, providing a fresh boost to the Pound Sterling rebound. In such a case, GBP/USD could see a sustained turnaround toward the 1.2600 level. On the other hand, GBP/USD could resume its downtrend toward 1.2375 if the UK CPI data show a notable cooling off in services inflation, suggesting that the BoE may not wait until September to announce a policy pivot. Dhwani Mehta, Asian Session Lead Analyst at FXStreet, offers a brief technical outlook for the major and explains: “The GBP/USD pair closed below the static support of 1.2450 on Monday, reinforcing the bearish interests. The 14-day Relative Strength Index (RSI) stays vulnerable below the midline, near 32.0, suggesting that there is more room to the downside for the Pound Sterling.” Dhwani adds: “A decisive break below the 1.2400 threshold could intensify the selling pressure, pushing GBP/USD toward the 1.2375 demand area. Around that level, the November 16 and 17 lows align. Further south, the 1.2300 round figure could be retested. On the other hand, any corrective upside will challenge the 1.2500 hurdle, above which a meaningful recovery toward the 200-day Simple Moving (SMA) at 1.2579 could be in the offing,” Dhwani adds. Economic Indicator Consumer Price Index (YoY) The United Kingdom (UK) Consumer Price Index (CPI), released by the Office for National Statistics on a monthly basis, is a measure of consumer price inflation – the rate at which the prices of goods and services bought by households rise or fall – produced to international standards. It is the inflation measure used in the government’s target. The YoY reading compares prices in the reference month to a year earlier. Generally, a high reading is seen as bullish for the Pound Sterling (GBP), while a low reading is seen as bearish. Read more. Next release: Wed Apr 17, 2024 06:00 Frequency: MonthlyConsensus: 3.1%Previous: 3.4%Source: Office for National Statistics Why it matters to traders? The Bank of England is tasked with keeping inflation, as measured by the headline Consumer Price Index (CPI) at around 2%, giving the monthly release its importance. An increase in inflation implies a quicker and sooner increase of interest rates or the reduction of bond-buying by the BOE, which means squeezing the supply of pounds. Conversely, a drop in the pace of price rises indicates looser monetary policy. A higher-than-expected result tends to be GBP bullish. Inflation FAQs What is inflation? Inflation measures the rise in the price of a representative basket of goods and services. Headline inflation is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core inflation excludes more volatile elements such as food and fuel which can fluctuate because of geopolitical and seasonal factors. Core inflation is the figure economists focus on and is the level targeted by central banks, which are mandated to keep inflation at a manageable level, usually around 2%. What is the Consumer Price Index (CPI)? The Consumer Price Index (CPI) measures the change in prices of a basket of goods and services over a period of time. It is usually expressed as a percentage change on a month-on-month (MoM) and year-on-year (YoY) basis. Core CPI is the figure targeted by central banks as it excludes volatile food and fuel inputs. When Core CPI rises above 2% it usually results in higher interest rates and vice versa when it falls below 2%. Since higher interest rates are positive for a currency, higher inflation usually results in a stronger currency. The opposite is true when inflation falls. What is the impact of inflation on foreign exchange? Although it may seem counter-intuitive, high inflation in a country pushes up the value of its currency and vice versa for lower inflation. This is because the central bank will normally raise interest rates to combat the higher inflation, which attract more global capital inflows from investors looking for a lucrative place to park their money. How does inflation influence the price of Gold? Formerly, Gold was the asset investors turned to in times of high inflation because it preserved its value, and whilst investors will often still buy Gold for its safe-haven properties in times of extreme market turmoil, this is not the case most of the time. This is because when inflation is high, central banks will put up interest rates to combat it. Higher interest rates are negative for Gold because they increase the opportunity-cost of holding Gold vis-a-vis an interest-bearing asset or placing the money in a cash deposit account. On the flipside, lower inflation tends to be positive for Gold as it brings interest rates down, making the bright metal a more viable investment alternative.  

The Australian Dollar (AUD) ends its three-day decline on Wednesday, bouncing back from levels not seen since mid-November.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}}Australian Dollar recovers recent losses on improved market sentiment on Wednesday.Australian labor data for March are scheduled to be released on Thursday.US Dollar Index (DXY) maintains its position close to a five-month high of 106.51.The Australian Dollar (AUD) ends its three-day decline on Wednesday, bouncing back from levels not seen since mid-November. Nevertheless, hawkish remarks from Federal Reserve (Fed) officials and the influx of safe-haven flows could bolster the US Dollar (USD) and potentially limit the upside of AUD/USD in the short term. The Australian Dollar gains upward momentum as the ASX 200 Index rebounds after three consecutive days of losses. However, AUD encountered obstacles, possibly due to risk aversion as investors awaited Israel's response to Iran's air strike on Saturday with caution. A Reuters report indicated that a third meeting of Israel's war cabinet, scheduled for Tuesday to determine a reaction to Iran's unprecedented direct attack, was postponed until Wednesday. Meanwhile, Western allies are considering swift imposition of new sanctions against Tehran to dissuade Israel from escalating the situation further. The US Dollar Index (DXY) remains close to a five-month high of 106.51, despite slight declines in US Treasury yields. Fed Chairman Jerome Powell's remarks on Tuesday, stating that recent data suggests little progress on inflation this year and that it will take longer than anticipated to reach the 2% target, may have contributed to a hawkish stance and provided some backing to the US Dollar. Daily Digest Market Movers: Australian Dollar recovers losses on improved sentiment Westpac Leading Index declined by 0.1% month-over-month in March, as compared to February’s increase of 0.8%. Australian Employment Change and Unemployment Rate for March are scheduled to be released on Thursday. China’s Gross Domestic Product (GDP) rose by 1.6% QoQ in the first quarter of 2024, against the previous quarter’s increase of 1.0%. GDP year-over-year rose by 5.3%, exceeding the expected 5.0% and 5.2% prior. China’s Industrial Production (YoY) increased by 4.5% in March, against the market expectations of 5.4% and 7.0% prior. Late on Tuesday, US National Security Advisor Jake Sullivan announced that new sanctions targeting Iran, along with sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry, will be implemented in the coming days. Federal Reserve (Fed) Bank of San Francisco President Mary Daly has emphasized that although there has been significant progress regarding inflation, there is still more to be done. She stressed the necessity of being assured that inflation is heading towards the target before making any decisions. According to the CME FedWatch Tool, the likelihood of interest rates remaining unchanged in the June meeting has been increased to 84.8% from Monday’s 78.7%. US Building Permits (MoM) fell to 1.458 million in March, compared to the expected 1.514 million and 1.523 million prior. Housing Starts declined to 1.321 million MoM from 1.549 million, falling short of the expected 1.480 million. US Retail Sales (MoM) increased by 0.7% in March, exceeding the market expectations of 0.3%. The previous reading was revised to 0.9% from 0.6% in February. Technical Analysis: Australian Dollar holds ground above the support level of 0.6400 The Australian Dollar trades around 0.6420 on Wednesday. The 14-day Relative Strength Index (RSI) indicates a bearish sentiment for the AUD/USD pair as it sits below the 50 level. Key resistance for the pair could be encountered at the 23.6% Fibonacci retracement level of 0.6449, coinciding with the significant level of 0.6450. A breach above the latter could bolster the pair's momentum towards testing the nine-day Exponential Moving Average (EMA) at 0.6480, and subsequently, the psychological barrier of 0.6500. On the downside, notable support is observed at the psychological level of 0.6400. A breach below this level may intensify downward pressure on the AUD/USD pair, potentially leading it toward the major support level at 0.6350, followed by November's low at 0.6318. AUD/USD: Daily ChartAustralian Dollar price today The table below shows the percentage change of Australian Dollar (AUD) against listed major currencies today. Australian Dollar was the strongest against the Pound Sterling.  USDEURGBPCADAUDJPYNZDCHFUSD  -0.03% 0.00% 0.00% -0.04% -0.01% -0.14% -0.01%EUR0.04%   0.04% 0.04% 0.00% 0.01% -0.12% 0.02%GBP-0.01% -0.05%   -0.01% -0.04% -0.03% -0.16% -0.03%CAD0.00% -0.03% 0.01%   -0.04% -0.02% -0.16% -0.02%AUD0.04% 0.02% 0.06% 0.05%   0.02% -0.10% 0.04%JPY0.01% -0.02% 0.02% 0.02% -0.05%   -0.14% 0.01%NZD0.16% 0.12% 0.17% 0.14% 0.11% 0.12%   0.14%CHF0.02% -0.02% 0.03% 0.01% -0.04% -0.01% -0.16%   The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Euro from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent EUR (base)/JPY (quote). Australian Dollar FAQs What key factors drive the Australian Dollar? One of the most significant factors for the Australian Dollar (AUD) is the level of interest rates set by the Reserve Bank of Australia (RBA). Because Australia is a resource-rich country another key driver is the price of its biggest export, Iron Ore. The health of the Chinese economy, its largest trading partner, is a factor, as well as inflation in Australia, its growth rate, and Trade Balance. Market sentiment – whether investors are taking on more risky assets (risk-on) or seeking safe havens (risk-off) – is also a factor, with risk-on positive for AUD. How do the decisions of the Reserve Bank of Australia impact the Australian Dollar? The Reserve Bank of Australia (RBA) influences the Australian Dollar (AUD) by setting the level of interest rates that Australian banks can lend to each other. This influences the level of interest rates in the economy as a whole. The main goal of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Relatively high interest rates compared to other major central banks support the AUD, and the opposite for relatively low. The RBA can also use quantitative easing and tightening to influence credit conditions, with the former AUD-negative and the latter AUD-positive. How does the health of the Chinese Economy impact the Australian Dollar? China is Australia’s largest trading partner so the health of the Chinese economy is a major influence on the value of the Australian Dollar (AUD). When the Chinese economy is doing well it purchases more raw materials, goods and services from Australia, lifting demand for the AUD, and pushing up its value. The opposite is the case when the Chinese economy is not growing as fast as expected. Positive or negative surprises in Chinese growth data, therefore, often have a direct impact on the Australian Dollar and its pairs. How does the price of Iron Ore impact the Australian Dollar? Iron Ore is Australia’s largest export, accounting for $118 billion a year according to data from 2021, with China as its primary destination. The price of Iron Ore, therefore, can be a driver of the Australian Dollar. Generally, if the price of Iron Ore rises, AUD also goes up, as aggregate demand for the currency increases. The opposite is the case if the price of Iron Ore falls. Higher Iron Ore prices also tend to result in a greater likelihood of a positive Trade Balance for Australia, which is also positive of the AUD. How does the Trade Balance impact the Australian Dollar? The Trade Balance, which is the difference between what a country earns from its exports versus what it pays for its imports, is another factor that can influence the value of the Australian Dollar. If Australia produces highly sought after exports, then its currency will gain in value purely from the surplus demand created from foreign buyers seeking to purchase its exports versus what it spends to purchase imports. Therefore, a positive net Trade Balance strengthens the AUD, with the opposite effect if the Trade Balance is negative.  

The USD/JPY pair trades with mild losses near 154.65 on Wednesday during the early Asian trading hours.

USD/JPY snaps the two-day winning streak around 154.65 in Wednesday’s early Asian session. Fed’s Powell emphasized that the current level of policy will likely stay in place until inflation gets closer to target.BoJ is shifting to a more discretionary policy-setting approach, with less focus on inflation.The USD/JPY pair trades with mild losses near 154.65 on Wednesday during the early Asian trading hours. The robust US economy and sticky inflation data have triggered the expectation that the Federal Reserve (Fed) might delay the easing cycle to September from June, which provides some support to the US Dollar (USD) against the Japanese Yen (JPY). However, the escalating tensions in the Middle East might boost safe-haven assets like JPY and cap the pair’s upside. 

Data released by the US Census Bureau showed on Tuesday that US Housing Starts fell 14.7% in March from a 12.7% increase in February (revised from 10.7%). The Building Permits declined 4.3% from a 2.3% rise (revised from 1.9%) in the previous reading. Industrial Production came in line with market expectation, rising 0.4% MoM in March from the 0.4% increase in February.

Several Fed officials, including Chairman Jerome Powell, emphasized the data-dependent stance of policy and have not committed to beginning the interest rate cuts. Fed Chair Jerome Powell said the US central bank has not seen inflation come back to the 2% target, indicating that interest rate cuts are unlikely anytime soon.

On the other hand, the Bank of Japan (BoJ) is shifting to a more discretionary approach in setting policy, with less emphasis on inflation. This, in turn, continues to weigh on the JPY and create a tailwind for the USD/JPY pair. Investors will take more cues from the BOJ's fresh quarterly growth and price projections due at its April 25–26 policy meeting, for fresh impetus. 

Meanwhile, the geopolitical tensions in the Middle East might lift the JPY and limit the upside of the USD/JPY pair. Late Tuesday, National Security Advisor Jake Sullivan said in a statement that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. Sullivan stated that the White House will not hesitate to continue to take action against the Iranian government. Tensions between Israel and Iran escalated after an attack on the Iranian embassy in Syria earlier this month, which killed two senior Iranian Revolutionary Guard Corps leaders. Iran blamed Israel for the attack, but Israel did not claim responsibility. USD/JPY Overview Today last price 154.62 Today Daily Change -0.10 Today Daily Change % -0.06 Today daily open 154.72   Trends Daily SMA20 152.08 Daily SMA50 150.54 Daily SMA100 147.94 Daily SMA200 147.42   Levels Previous Daily High 154.79 Previous Daily Low 153.9 Previous Weekly High 153.39 Previous Weekly Low 151.57 Previous Monthly High 151.97 Previous Monthly Low 146.48 Daily Fibonacci 38.2% 154.45 Daily Fibonacci 61.8% 154.24 Daily Pivot Point S1 154.15 Daily Pivot Point S2 153.58 Daily Pivot Point S3 153.27 Daily Pivot Point R1 155.04 Daily Pivot Point R2 155.36 Daily Pivot Point R3 155.93    

The People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead on Tuesday at 7.1025 as compared to the previous day's of 7.1028 and 7.2404 Reuters estimates.

The People’s Bank of China (PBoC) set the USD/CNY central rate for the trading session ahead on Tuesday at 7.1025 as compared to the previous day's of 7.1028 and 7.2404 Reuters estimates.

Australia Westpac Leading Index (MoM) fell from previous 0.08% to -0.1% in March

The EUR/USD pair extends its downside near 1.0620, bouncing off the Year-To-Date (YTD) low of 1.0600 during the early Asian session on Wednesday.

EUR/USD remains on the defensive around 1.0615 in Wednesday’s early Asian session. Fed’s Powell said it's appropriate to allow restrictive policy to continue to work, given the strength of the labor market. ECB’s Lagarde noted the central bank remains on course to cut rates in the near term, subject to any major shocks.The EUR/USD pair extends its downside near 1.0620, bouncing off the Year-To-Date (YTD) low of 1.0600 during the early Asian session on Wednesday. However, the hawkish comments from the Federal Reserve (Fed) officials and the safe-haven flows might boost the US Dollar (USD) and cap the upside of EUR/USD in the near term. 

On Tuesday, Fed Chairman Jerome Powell said that the US economy's performance has been quite robust. Powell further stated that recent data indicates a lack of significant progress on inflation this year and it will take "longer than expected" to achieve the confidence that inflation will get down to the 2% target. A hawkish tilt by Fed’s Powell provides some support to the Greenback and drags the EUR/USD pair lower. 

About the data, Housing Starts in the US fell 14.7% in March to 1.32 million units from the previous reading of a 12.7% increase (revised from 10.7%). The US Building Permits dropped 4.3% from a rising 2.3% (revised from 1.9%) in February. Finally, Industrial Production rose 0.4% MoM in March, compared to the 0.4% increase recorded in February, in line with market expectation.

Across the pond, there is growing speculation that the European Central Bank (ECB) will start lowering interest rates in June due to a weak Eurozone economic outlook and cooling core inflationary pressures. ECB President Christine Lagarde said on Tuesday that the central bank remains on course to cut interest rates in the near term, subject to any major shocks. Lagarde added that the ECB will closely monitor oil prices amid the rising tensions in the Middle East. Later on Wednesday, the Eurozone Harmonized Index of Consumer Prices (HICP) for March will be due. Also, the ECB’s Cipollone, Schnabel and President Lagarde are set to speak.  EUR/USD Overview Today last price 1.0618 Today Daily Change -0.0001 Today Daily Change % -0.01 Today daily open 1.0619   Trends Daily SMA20 1.0788 Daily SMA50 1.0818 Daily SMA100 1.086 Daily SMA200 1.0826   Levels Previous Daily High 1.0654 Previous Daily Low 1.0601 Previous Weekly High 1.0885 Previous Weekly Low 1.0622 Previous Monthly High 1.0981 Previous Monthly Low 1.0768 Daily Fibonacci 38.2% 1.0621 Daily Fibonacci 61.8% 1.0634 Daily Pivot Point S1 1.0595 Daily Pivot Point S2 1.0572 Daily Pivot Point S3 1.0543 Daily Pivot Point R1 1.0648 Daily Pivot Point R2 1.0677 Daily Pivot Point R3 1.07    

Japan Adjusted Merchandise Trade Balance dipped from previous ¥-451.6B to ¥-701.5B in March

Japan Imports (YoY) declined to -4.9% in March from previous 0.5%

Japan Merchandise Trade Balance Total climbed from previous ¥-379.4B to ¥366.5B in March

Japan Exports (YoY) down to 7.3% in March from previous 7.8%

National Security Advisor Jake Sullivan said in a statement late Tuesday that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days.

.fxs-faq-module-wrapper{border:1px solid #dddedf;background:#fff;margin-bottom:32px;width:100%;float:left;font-family:Roboto,sans-serif}.fxs-faq-module-title{color:#1b1c23;font-size:16px;font-style:italic;font-weight:700;line-height:22.4px;text-transform:uppercase;background:#f3f3f8;padding:8px 16px;margin:0}.fxs-faq-module-container{padding:16px;width:100%;box-sizing:border-box;display:flex;flex-direction:column;gap:12px}.fxs-faq-module-section{padding-bottom:16px;border-bottom:1px solid #ececf1;margin-bottom:0}.fxs-faq-module-section:last-child{border:none;margin-bottom:0}.fxs-faq-module-container input[type=checkbox]{display:none}.fxs-faq-module-header{padding:4px 0;background-color:#fff;border:none;position:relative;cursor:pointer;margin:0}.fxs-faq-module-header label{display:block;cursor:pointer}.fxs-faq-module-header label span{display:block;width:calc(100% - 50px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{content:"";position:absolute;top:50%;right:16px;width:8px;height:2px;background-color:#49494f;transition:all .2s ease-in-out;transition-delay:0}.fxs-faq-module-header label:after{transform:rotate(45deg) translateX(-4px)}.fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(4px)}.fxs-faq-module-header label:after,.fxs-faq-module-header label:before{transition:transform .3s ease-in-out}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:after{transform:rotate(45deg) translateX(4px)}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-header label:before{transform:rotate(-45deg) translateX(-4px)}.fxs-faq-module-content{max-height:0;overflow:hidden;transition:all .3s ease-in-out;color:#49494f;font-weight:300;padding:0;font-size:14.72px;line-height:20px;margin:0}input[type=checkbox]:checked+.fxs-faq-module-section .fxs-faq-module-content{max-height:1000px;margin-top:8px}@media (min-width:680px){.fxs-faq-module-title{font-size:19.2px;line-height:27.2px}.fxs-faq-module-header{font-size:19.2px;line-height:25.92px}.fxs-faq-module-content{font-size:16px;line-height:21.6px}} National Security Advisor Jake Sullivan said in a statement late Tuesday that new sanctions targeting Iran and sanctions against entities supporting the Islamic Revolutionary Guard Corps and Iran's Defense Ministry will be imposed in the coming days. It is expected that US allies and partners will soon follow with their sanctions, according to the statement.

Sullivan further stated that these new sanctions and other measures will "continue a steady drumbeat of pressure" to contain and degrade Iran's military capacity and effectiveness and confront the full range of its problematic behaviors.  Market reactionGold price attracts some buyers following the renewed tension between Israel and Iran. XAU/USD was trading 0.08% higher on the day at $2,384, as of writing. Gold FAQs Why do people invest in Gold? Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government. Who buys the most Gold? Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves. How is Gold correlated with other assets? Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal. What does the price of Gold depend on? The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.  

The GBP/USD pair remains on the defensive around 1.2430 during the early Asian session on Wednesday.

GBP/USD attracts some sellers to 1.2430 on the stronger USD. Fed’s Powell said the US monetary policy needs to be restrictive for longer. BoE’s Bailey saw strong evidence that UK inflation was falling. The GBP/USD pair remains on the defensive around 1.2430 during the early Asian session on Wednesday. The further upside in the US Dollar (USD) from a hawkish tilt by Federal Reserve (Fed) Chair Jerome Powell and upbeat US Retail Sales data weighs on the GBP/USD pair. Investors will take more cues from the UK Consumer Price Index (CPI) on Wednesday. 

The Fed Chair Jerome Powell said on Tuesday that monetary policy needs to be restrictive for longer and further dampen investors' hopes for meaningful rate cuts this year. Powell added that the recent economic data have clearly not given the Fed greater confidence and it's likely to take longer than expected to achieve that confidence. The US central bank has kept its benchmark interest rate in a target range between 5.25% and 5.5% since July 2023. Financial markets have had to reset their expectations for rate cuts this year, with the anticipation of one or two reductions that will not start until September.

On the other hand, investors price in two rate cuts by the Bank of England (BoE) this year, with the first move in August or September and earlier rate cuts than the Fed. This, in turn, has exerted some selling pressure on the Pound Sterling (GBP) and created a headwind for the GBP/USD pair

The BoE Governor Andrew Bailey said on Tuesday there was strong evidence that UK inflation was falling and that the question for BoE policymakers remained how much more evidence was necessary before starting to cut interest rates. Bailey further stated that different inflation paths for the US and Europe this year could lead to somewhat different paths for interest rates. GBP/USD Overview Today last price 1.243 Today Daily Change -0.0016 Today Daily Change % -0.13 Today daily open 1.2446   Trends Daily SMA20 1.2615 Daily SMA50 1.2653 Daily SMA100 1.2667 Daily SMA200 1.2582   Levels Previous Daily High 1.2499 Previous Daily Low 1.2436 Previous Weekly High 1.2709 Previous Weekly Low 1.2427 Previous Monthly High 1.2894 Previous Monthly Low 1.2575 Daily Fibonacci 38.2% 1.246 Daily Fibonacci 61.8% 1.2475 Daily Pivot Point S1 1.2421 Daily Pivot Point S2 1.2397 Daily Pivot Point S3 1.2358 Daily Pivot Point R1 1.2484 Daily Pivot Point R2 1.2523 Daily Pivot Point R3 1.2547    

New Zealand Consumer Price Index (YoY) down to 4% in 1Q from previous 4.7%

Inflation in New Zealand, as measured by the change in the Consumer Price Index (CPI), rose to 6.8% QoQ in the first quarter (Q1) of 2024 from 0.5% in the previous reading, Statistics New Zealand reported on Wednesday.

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Annualized CPI inflation in New Zealand came in at 3.7% YoY compared to the previous period's 4.7%.Market reaction to New Zealand CPI dataThe New Zealand Dollar (NZD) edged higher with the immediate reaction. The NZD/USD pair was last seen rising 0.32% on the day at 0.5898.  New Zealand Dollar FAQs What key factors drive the New Zealand Dollar? The New Zealand Dollar (NZD), also known as the Kiwi, is a well-known traded currency among investors. Its value is broadly determined by the health of the New Zealand economy and the country’s central bank policy. Still, there are some unique particularities that also can make NZD move. The performance of the Chinese economy tends to move the Kiwi because China is New Zealand’s biggest trading partner. Bad news for the Chinese economy likely means less New Zealand exports to the country, hitting the economy and thus its currency. Another factor moving NZD is dairy prices as the dairy industry is New Zealand’s main export. High dairy prices boost export income, contributing positively to the economy and thus to the NZD. How do decisions of the RBNZ impact the New Zealand Dollar? The Reserve Bank of New Zealand (RBNZ) aims to achieve and maintain an inflation rate between 1% and 3% over the medium term, with a focus to keep it near the 2% mid-point. To this end, the bank sets an appropriate level of interest rates. When inflation is too high, the RBNZ will increase interest rates to cool the economy, but the move will also make bond yields higher, increasing investors’ appeal to invest in the country and thus boosting NZD. On the contrary, lower interest rates tend to weaken NZD. The so-called rate differential, or how rates in New Zealand are or are expected to be compared to the ones set by the US Federal Reserve, can also play a key role in moving the NZD/USD pair. How does economic data influence the value of the New Zealand Dollar? Macroeconomic data releases in New Zealand are key to assess the state of the economy and can impact the New Zealand Dollar’s (NZD) valuation. A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and may encourage the Reserve Bank of New Zealand to increase interest rates, if this economic strength comes together with elevated inflation. Conversely, if economic data is weak, NZD is likely to depreciate. How does broader risk sentiment impact the New Zealand Dollar? The New Zealand Dollar (NZD) tends to strengthen during risk-on periods, or when investors perceive that broader market risks are low and are optimistic about growth. This tends to lead to a more favorable outlook for commodities and so-called ‘commodity currencies’ such as the Kiwi. Conversely, NZD tends to weaken at times of market turbulence or economic uncertainty as investors tend to sell higher-risk assets and flee to the more-stable safe havens.  

New Zealand Consumer Price Index (YoY) dipped from previous 4.7% to 3.7% in 1Q

The NZD/USD declined towards 0.5879 on Tuesday reflecting a loss of 0.46%, despite.

The USD strengthened, propelled by rising US Treasury yields and speculation of a Fed's delaying cuts.Escalating geopolitical tensions in the Middle East also drive demand for the Greenback.Fed's Powell commented that inflation is showing a lack of progress.Soft housing market from the US data failed to trigger a reaction on the pair.The NZD/USD declined towards 0.5879 on Tuesday reflecting a loss of 0.46%, despite. The pair's movements are largely influenced by the market’s adjustments of their expectations and the delay of a rate cut by the Federal Reserve (Fed) by year-end. Rising Treasury yields are also applying downward pressure on the pair. On the data front, in March, Building Permits experienced a decline of 4.3%, dropping to 1.458 million, below both projected and February's figures. Housing starts also saw a significant drop of 14.7%, falling short of expectations at 1.321 million. However, industrial production for the same month rose by 0.4%, meeting expectations.  What drives the pair downwards is markets now betting on a more aggressive Fed. Following strong US data, market sentiment adjusted with expectations of an initial rate cut in September, and a 70% probability for a second cut in December. Expectations for a June rate cut have decreased to 25% from 60% the previous week. In addition, on Tuesday, Jerome Powell hinted that he sees no progress on inflation and that he considered that the monetary policy may need some additional time to work. The readjustments in expectations are also propelling US Treasury yields which also benefits the USD over the NZD. NZD/USD technical analysis Based on the indicators of the daily chart, the NZD/USD pair is exhibiting negative momentum. The Relative Strength Index (RSI) stands at 33.18, indicating a negative trend and nearing the oversold territory. Additionally, the Moving Average Convergence Divergence (MACD) histogram is exhibiting rising red bars, confirming the negative momentum and suggesting that sellers currently dominate the market. On the broader outlook, the NZD/USD also shows a negative trend as it trades below its 20, 100, and 200-day Simple Moving Averages (SMA). Unless buyers make a move above these levels, the bears will remain comfortable and dictate the pace of the pair. NZD/USD daily chart NZD/USD Overview Today last price 0.5886 Today Daily Change -0.0018 Today Daily Change % -0.30 Today daily open 0.5904   Trends Daily SMA20 0.6002 Daily SMA50 0.6079 Daily SMA100 0.6134 Daily SMA200 0.6063   Levels Previous Daily High 0.5954 Previous Daily Low 0.5898 Previous Weekly High 0.6079 Previous Weekly Low 0.5933 Previous Monthly High 0.6218 Previous Monthly Low 0.5956 Daily Fibonacci 38.2% 0.5919 Daily Fibonacci 61.8% 0.5933 Daily Pivot Point S1 0.5884 Daily Pivot Point S2 0.5863 Daily Pivot Point S3 0.5828 Daily Pivot Point R1 0.594 Daily Pivot Point R2 0.5975 Daily Pivot Point R3 0.5996    

Silver prices retreat from daily highs reached $29.01, dropping 2.63%, affected by high US Treasury yields, and stirring resistance around the $29.00 threshold.

Silver retreats to $28.09, unable to hold above the crucial $29 mark, indicating potential further declines.The 'dark cloud cover' technical pattern suggests vulnerability and possible downward movement.Focus remains on silver's ability to sustain above the $28.00 threshold, with key support and resistance levels closely watched.Silver prices retreat from daily highs reached $29.01, dropping 2.63%, affected by high US Treasury yields, and stirring resistance around the $29.00 threshold. The XAG/USD trades at $28.09, breaking key support levels on its way toward current spot prices. XAG/USD Price Analysis: Technical outlook From a technical standpoint, XAG/USD buyers failed to hold Siver’s quote above the psychological $29.00 level after reaching a year-to-date (YTD) high of $29.79. That exacerbated the grey’s metal drop toward the $28.00 mark, opening the door for further downside. During the last couple of days, price action formed a ‘dark cloud cover’ that needs confirmation below the April 15 low of $27.59. Momentum was extremely bullish, though the Relative Strength Index (RSI) exited from overbought conditions during the day, sponsoring a leg-down on Silver. That said, XAG/USD could witness a pullback before buyers attempt to challenge the $29.00 mark. Given the backdrop, Siver’s first support would be $27.59, followed by the $27.00 mark. Further losses are seen at $26.29, the April 5 low. On the flip side, if buyers keep the XAG/USD spot price above $28.00, the next resistance levels are seen at the June 10, 2021, high at $28.28, followed by the May 18, 2021 high at $28.74. XAG/USD Price Action – Daily ChartXAG/USD Overview Today last price 28.1 Today Daily Change -0.77 Today Daily Change % -2.67 Today daily open 28.87   Trends Daily SMA20 26.28 Daily SMA50 24.46 Daily SMA100 24 Daily SMA200 23.63   Levels Previous Daily High 28.89 Previous Daily Low 27.62 Previous Weekly High 29.8 Previous Weekly Low 26.88 Previous Monthly High 25.77 Previous Monthly Low 22.51 Daily Fibonacci 38.2% 28.41 Daily Fibonacci 61.8% 28.11 Daily Pivot Point S1 28.03 Daily Pivot Point S2 27.19 Daily Pivot Point S3 26.77 Daily Pivot Point R1 29.3 Daily Pivot Point R2 29.73 Daily Pivot Point R3 30.57    
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