Wednesday March 22nd Morning Update
Wednesday March 22nd, 2023?
?
The US$ and oil price hedges lower, equity markets unchanged and US yields slightly lower. The markets are quiet to start the day as we await the Federal Reserve interest rate decision later this afternoon. Expectation remains a 25bps increase. The FOMC minutes as well as the following press conference will be of interest to the market participant as the FED will address the recent bank failure as well as offer clues on future interest rate movement.
?
In other news. Xi and Putin meeting ends with pledge to shape a new world order. North Korea fires multiple cruise missiles off its east coast as South Korea and the USA conduct joint military exercises. IMF agreed to a US$15.6B loan package to Ukraine.?
??
In Currency markets.?The USD currency strengthen against the JPY (0.23%), PHP (0.24%) while weakening against the AUD (0.43%), NZD (0.40%) , THB (0.17) and ZAR (0.49%)
??
Current level US$ Index???????????????103.0.31??????????Down 0.21%
??
The USD/CAD pair is showing a corrective move after failing to extend its recovery above 1.3740 in the Asian session. Declining Canada’s Consumer Price Index (CPI) and BoC governor’s Macklem comments about present monetary policy being restrictive enough points to an unchanged interest policy stance. Fed to announce their decision later today. Support lowers to 1.3635 while resistance resets to 1.3750.?
?
Current level US$/C$???????????????????1.3696???????????Down 0.12%?
?
EURCAD pushed higher reaching levels not seen since Sep 2021. The diverging interest policies from the BoC and ECB are key to this recent run up. Support rises to 1.4685 while resistance resets at 1.4831.?
?
领英推荐
?
Current level EUR/C$???????????????????1.4773????????????Up 0.08%?
?
Lagarde reiterated on Wednesday that underlying inflation dynamics in the Eurozone remain strong. She added that they must and will bring down inflation to the target and were neither committed to raise further nor are they finished hiking rates. Support hedges higher to 1.0658 while resistance is within striking distance at 1.0794.
?
Current level EUR/US$????????????????1.0785???????????Up 0.17%?
?
Higher than expected UK inflation data (ahead of tomorrow’s BoE interest announcement) coupled with Banking crisis which may lead to a soften hawkish bias by ECB’s Lagarde has pushed the EUR/GBP lower. Support holds at 1.1300 (.8849) while resistance resets to 1.1389 (.8733).?
?
Current level GBP/EUR????1.1390 (.8776)??????????Up 0.41%?
?
?
UK CPI rose to 10.4% (10.1% previous month) exceeding expectation of 9.9%. This is the first time in 4 months that the inflation rate rose on a month-to-month basis. The GBP rallied on the back of this news as await the Fed’s rate announcement later today and the BoE tomorrow. Support remains to 1.2208 while resistance at 1.2320.?
??
Current level GBP/US$????????????????1.2283????????????Up 0.56%?