In this article, we have covered the highlights of global market news about the GBP/USD, AUD/USD, NZD/USD and EUR/USD.
GBP/USD: A rebound to 1.1500 around the new year would be fair, according to ING
GBP/USD has entered a period of consolidation of around about 1.2250. By year’s end, ING economists predict that the pair will fall near 1.1500.
Is cable getting close to the top?
“US Nonfarm Payrolls may fall short of reversing the Dollar’s negative trend, and GBP/USD may find a little more support between 1.2300-1.2350.”
“Cable, however, is not considering the adverse effects of rising gas costs and dismal economic fundamentals. A return to 1.1500 around the new year would be reasonable.
The AUD/USD is trading around a multi-month high, just over 0.6800, as traders await the US NFP news.
On Friday, the AUD/USD pair resumes its upward trend after an intraday decline below 0.6880. Spot prices rose steadily during the first half of the European session, reaching a high of 0.6835, which brings them back closer to the highest point since September 13, which was reached on Thursday.
Rising odds for a less aggressive Fed tightening policy are continuing the relentless selling of the US dollar, which benefits the AUD/USD pair. Expectations that the US central bank would curtail the rate-hiking cycle were confirmed by Fed Chair Jerome Powell’s dovish-sounding remarks and evidence of diminishing inflationary pressures. The US dollar continues to suffer due to the high US Treasury bond rates.
The Australian Dollar, a proxy for China, also benefits from expectations of greater Chinese stimulus and the loosening of tough COVID-19 regulations in the world’s second-largest economy. Nevertheless, the cautious market atmosphere can operate as a barrier for considered riskier currencies and restrain any further rises for the AUD/USD pair. Additionally, traders hesitated to make risky wagers before the US monthly employment figures were released.
NZD/USD: 0.6450 is the next significant target level – ANZ
Kiwi just made a move that allowed it to pass resistance at 0.6325. According to ANZ Bank experts, 0.6450 is the next goal on the upswing.
The Kiwi has a significant interest rate advantage. “The Kiwi has sharply risen. The leading cause of this is a lower USD (the DXY is at a new cycle low), but the NZD has also stood out versus the AUD, which is likely due to its significant interest rate advantage. That’s unquestionably a rock-solid foundation (particularly in light of the decline in US bond rates).
Technically, the next significant target level is 0.6450, which corresponds to the August high and the 61.8% retracement of the 2022 advance.
EUR/USD eases over 1.0500 as Lagarde, the head of the ECB, expresses caution ahead of the US NFP inquiry.
The EUR/USD currency pair reflects the market’s cautious attitude as it maintains stability at a five-month high above 1.0530 early Friday.
However, the main currency pair’s most recent inactivity may be related to worries about probable negative US job statistics and economic apprehensions mentioned by important US and European authorities.
Christine Lagarde, president of the European Central Bank (ECB), recently emphasized the need for short-term and customized fiscal policy. The policymaker said, “All policies must coordinate for sustainable development.”
Additionally, according to International Monetary Fund (IMF) Managing Director Kristalina Georgieva, the prognosis for the global economy is very unclear and dominated by uncertainties. Recession risks are increasing in many countries. The US Dollar Index (DXY) was able to take a break at its lowest levels since early July due to the same factor challenging the market mood.
Even yet, dovish remarks from the majority of Fed members, including Chairman Jerome Powell, and the bloc’s record-low unemployment rate, help to give EUR/USD purchasers reason for optimism.
The US 10-year Treasury rates posted a corrective recovery off the 10-week low to 3.54% by press time, while the S&P 500 Futures dropped 0.30% intraday to 4,070.
Moving forward, the EUR/USD may stay dormant due to a cautious attitude and a light schedule before the US employment data. The headline Nonfarm Payrolls (NFP) is anticipated to slip to 200K print from 261K before, while the Unemployment Rate may keep the same at 3.7%. Despite this, the bulls will likely maintain their lead in the market.
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