Europe roundup: Pound plunges on record current account deficit, European stocks tumble, gold tumbles, oil stabilizes as fuel inventories thwart supply issues – June 30, 2022
• German Import Price Index (monthly) May 0.9%, 1.6% forecast, 1.8% previous
• UK GDP (QT) (Q1) 0.8%, 0.8% forecast, 1.3% previous
• UK GDP (Year) (Q1) 8.7%, 8.7% forecast, 6.6% previous
• Business investment in UK GDP (QT) (Q1) -0.6%, previous -0.5%
• UK current account (Q1) -51.7 billion, -39.8 billion expected, -7.3 billion previous
• German Retail Sales in May (monthly) 0.6%, forecast 0.5%, previous -5.4%
• German Import Price Index in May (Annual) 30.6%, 31.5% forecast, 31.7% previous
• Swiss Retail Sales in May (YY) 1.6% forecast, -6.0% previous
• French consumer spending in May (monthly) 0.7%, forecast 0.2%, previous -0.4%
• French CPI (monthly) 0.7%, 0.7% forecast, -0.7% previous
• French CPI (Annual) 5.8%, 5.7% forecast, 5.2% previous
• German unemployment rate June 5.3%, 5.0% forecast, 5.0% previous
•German unemployment June nos 2.363M , 2.246M forecast , 2.260M previous
• June unemployment in Germany: 133,000, -6,000 forecast, -4,000 previous
Forward-looking economic data (GMT)
•12:30 US May PCE Price index (YoY) 6.3 previous
• 12:30 p.m. US May Personal Income (MoM) 0.5% forecast, -0.4% previous
• 12:30 p.m. US Personal Spending (MoM) 0.4% forecast, 0.9% previous
• 12:30 p.m. US PCE Price Index (MoM) 0.2% previous
• 12:30 US May Core PCE Price Index (MoM) 0.4% forecast, 0.3% prior
• 12:30 US May Core PCE Price Index (YoY) 4.8% forecast, 4.9% previous
•12:30 Canada GDP in April (monthly) 0.3% forecast, 0.7% previous
• 12:30 p.m. Initial unemployment claims in the United States 228,000 forecast, 229,000 previous
• 12:30 p.m. Continuing jobless claims in the United States 1,310,000 forecast, 1,315,000 previous
• 12:30 pm Unemployment claims in the United States over an average of 4 weeks. 223.50K previous
•13:45 US Chicago PMI 58.0 forecast, 60.3 previous
• 2:30 p.m. US Natural Gas Storage 74B forecast, previous 74B
•3:30 PM US 4-Week Bill Bid 1.100% previous
• 3:30 PM US 8-Week Bill Auction 1.500% previous
Future Outlook – Events, Other Releases (GMT)
•1:30 p.m. EU ECB President Lagarde speaks
EUR/USD: The euro fell on Thursday as the dollar benefited from safe-haven demand on renewed concerns about higher rates and a global recession. The euro was at $1.044, having lost 0.75% against the dollar the previous day, and was heading for a monthly decline of 2.7%. A steady and aggressive global shift towards tougher policy has stoked recession fears and rattled financial markets in recent months. Speaking at the European Central Bank’s annual conference in Sintra, Portugal, US Federal Reserve Chairman Jerome Powell said it was important to bring inflation down, if it meant economic pain, with similar remarks from ECB President Christine Lagarde. Immediate resistance can be seen at 1.0497 (5DMA), a break up can trigger a rise towards 1.0533 (38.2% fib). On the downside, immediate support is seen at 1.0384 (23.6% fib), a break below could take the pair towards 1.0299. (lower BB).
GBP/USD: The pound fell against the dollar on Thursday as data showed a record low in the UK’s current account deficit at the start of 2022. Data on Thursday showed Britain recorded record current account deficit in the first three months of this year. , while the deficit climbed to 51.7 billion pounds ($62.8 billion) or 8.3% of gross domestic product. Expectations of a bigger hike were tempered on Wednesday after Bank of England Governor Andrew Bailey struck a softer tone, saying the central bank won’t necessarily have to act “forcefully” to controlling inflation. which called for a very gradual tightening given a faster-than-expected economic slowdown. Immediate resistance can be seen at 1.2202 (5DMA), a break up can trigger a rise towards 1.2353 (38.2% fib). On the downside, immediate support is seen at 1.2106 (23.6% fib), a break below could take the pair towards 1.1963 (BB lower).
USD/CHF: The dollar strengthened against the Swiss franc on Thursday as the dollar benefited from safe-haven demand on renewed concerns about higher rates and a global recession. Central bank chiefs from the US Federal Reserve, European Central Bank and Bank of England met in Portugal this week and expressed their renewed commitment to controlling inflation, however painful it may be. cause. Traders are now focused on US core price data due at 12:30 GMT which should underline the scale of the inflation challenge. Immediate resistance can be seen at 0.9592 (5DMA), a break up can trigger a rise towards 0.9635 (50% fib). On the downside, immediate support is seen at 0.9496 (61.8% fib), a break below could take the pair towards 0.9422 (BB lower).
USD/JPY: The dollar stabilized against the Japanese yen on Thursday as the spread between a hawkish Fed and a dovish Bank of Japan continues to weigh heavily on the yen. The BOJ is able to keep interest rates low as Japanese inflation is still low by global standards, although even small price increases pose a messaging problem for the central bank. The dollar also hit a new 24-year high at 137 yen overnight. The dollar index, which measures the greenback against six peers, was at 105.19, a two-week high. Strong resistance can be seen at 136.98 (23.6% fib), a break up can trigger a rise towards 137.87 (BB upper). On the downside, immediate support is seen at 135.91 (5DMA), a break below could take the pair towards 134.71 (38.2%fib).
Summary of actions
On Thursday, European stocks looked set for their worst quarter since the carnage caused by the pandemic at the start of 2020, as investors grew increasingly wary of a global recession following hawkish actions by the central bank to rein in rapid inflation.
At (12:20 GMT), Britain’s benchmark FTSE 100 last traded at 2.04%, Germany’s Dax was down 2.60%, France’s CAC ended down 2.59 %.
Summary of raw materials
Gold fell on Thursday and was destined for its worst quarter in five as a stronger dollar and hawkish rhetoric from central banks eroded the attractiveness of the non-performing asset.
Spot gold fell 0.5% to $1,808.60 an ounce at 11:05 GMT, on track to fall more than 6% for the quarter and to fall for a third consecutive month. US gold futures slid 0.4% to $1,810.60.
Oil prices were largely flat in volatile trading on Thursday as the market weighed concerns over global supply against a rise in U.S. petroleum product inventories.
Brent futures for September, the most actively traded contract, rose 28 cents, or 0.3%, to $112.73 a barrel at 0911 GMT. The August contract, which expires Thursday, was down 11 cents, or 0.1%, at $116.15.
U.S. West Texas Intermediate (WTI) crude futures rose 20 cents, or 0.2%, to $109.98.