NY Open: The stage is set for a big finish to January
FX Trader, Loonieviews.net
Summary: Next week is the end of January and FX markets are poised for a big finish. There is another UK parliamentary vote on Theresa May’s Brexit Plan B, a FOMC meeting, nonfarm payrolls data and the possibility of month-end portfolio rebalancing high jinks
The Federal Open Market Committee meeting could be a barn-burner, especially if Fed Chair Jerome Powell answers questions about his apparent flip-flop between the December 21 press conference and his January 4 speech. The committee is widely expected to leave rates unchanged.
The consensus forecast for Friday’s nonfarm payrolls report is for a gain of 168,000 jobs, well below Decembers 312,000 increase, but still healthy.
Other flash-points include the US government shutdown and the US/China trade talks. Positive developments from either one them would boost Wall Street and spark a bit of a “risk-on” rally in FX.
The US dollar is on the defensive. The major G-10 currency pairs all posted gains since this morning’s open, and they are making a serious run at eliminating all their losses since last Friday’s close. Only the Australian dollar is underwater, as of 1345 GMT. NZDUSD is leading the charge higher, but it is an extremely close race. USDJPY is the laggard, and it is unchanged since the open. GBPUSD appears to have snapped the downtrend line from April 2018 with the break above 1.2980 on a daily chart which puts 1.3250 in play.
US stocks are higher as Wall Street follows the lead of European bourses. Prices are supported by a mix of profit-taking, some positive earnings reports, and the mildly improved outlook for US/China trade. However, the major indices need to climb a lot further to get back to Tuesday’s levels.
Quarterly Outlook Q2 2022
Quarterly Outlook Q2 2022: The End Game has arrived
- Shocks from covid and the war in Ukraine have forced the global financial and political world to change, but what will the end game be?
Productivity and innovation have never been more importantAs the world economy hits physical limits and central banks tighten their belts, could equities be facing a 10-15% downside?
The great EUR recovery and the difficulty of trading itIf the terrible fog of war hopefully lifts soon, the conditions are promising for the euro to reprice significantly higher.
Tight commodity markets – turbocharged by war and sanctionsWith supply already tight, commodities keep powering on. But will it last for yet another quarter?
Between a rock and a hard placeGeopolitical concerns will add upward price pressures and fears of slower growth, while volatility will remain elevated.
The Great ErosionInflation is everywhere and central banks try to combat it. But will they get it under control in time?
Australian investing: Six considerations amid triple Rs: rising rates, record inflation and likely recessionWhile global financial markets are struggling in an uncertain world, the commodity-heavy Australian ASX index is poised to keep a positive momentum.
Cybersecurity – the rush to catch up with realityWith the invasion of Ukraine, governments and private companies are rushing to reinforce their cyber defenses.