Morning Brew December 12 2023
Senior Relationship Manager
All Eyes ont he US CPI at 14:30
Today all eyes will be on the US CPI at 14:30 CET , the German ZEW at 11:00 CET will not find too much attention unless there is a huge surprise.
The Expectation for the CPI is 3.1 and 4 on the Core, the ranges of expectation are a high of 3.4 and a low of 3.1 and for the core high 4.1 and low 3.9. The narrow range makes surprises more likely and also the chance of a sharp move after the release. Relative to yesterday, the mood is more dovish, yesterday morning when I wrote, rate traders had anticipated 98BPS worth of rate cuts, now it is 114.
Ahead of the release, Equities are still in Goldilocks mood as major indexes close at new year highs in small but consistent gains: the Dow and the added 0.4%, the Nasdaq 0.2% ant eh Dax seems to be on the way to 17000 unphased by the poor German economy.
Stock of the day was Macy`s which gained app 20% on an offer to take the company private Semiconductors were generally strong but NVidia fell almost 2% against the trend.
Ten Year Yields are trading at 4.20 and the USD Index fell to 103.90, EURUSD 1.0768, GBPUSD 1.2575 and USDJPY 145.40, Gold is 1987 and Silver 23. Kim Wrote on Precious Metals yesterday: Gold XAUUSD has broken below support and 0.618 retracement at around 2,009 and seems likely to drop to the 0.786 retracement at 1,975
Silver XAGUSD sell-off is currently testing the upper Cloud area (shaded area) and is likely to be testing the 0.786 retracement at 22.75 shortly.
If bouncing off the 0.786 retracement Silver could see a rebound back to the 24 level. And likely resuming uptrend.
Platinum XPTUSD is bouncing back above the falling trendline and is at the time of writing back above the Cloud. If closing above (the Cloud a bullish move to test the strong resistance at around 952.30 could be seen. A close above could fuel a rally to 990-1,000
Althea composed a preview oft he ECB rate decision on Thursday
Expect volatility at 14:30 and beyond, trade safely!
- Data: Corporate Goods Prices, UL Labor Data, Germany ZEW, US Consumer Price Index,
- Data Japan Tankan. UK GDP, US PPI & Rate Decision
- Data Australia Unemployment Rate, Sweden CPI, Switzerland, Norway, BOE and EU Rate Decisions, US Initial Jobless Claims
- Data Global PMI US International PMI, Quadruple Witching Friday
Physically Settled Futures
JGB1Z3 will expire 12 Dec 2023 at 01:00 GMT
AUDUSDADDEC23 will expire 13 Nov 2023 at 16:00 GMT
EURJPYRYDEC23 will expire 13 Nov 2023 at 16:00 GMT
EURUSDECDEC23 will expire 13 Nov 2023 at 16:00 GMT
GER50MIDDEC23 will expire 13 Nov 2023 at 16:00 GMT
UK100DEC23 will expire 13 Nov 2023 at 16:00 GMT