In this article, we have covered the highlights of global market news about the NZD/USD, EUR/USD, GBP/USD and USD/JPY.
NZDUSD flirts with a daily low, at 0.6120, amid strong USD demand.
On the opening day of a new week, the NZDUSD pair experiences some selling pressure and drifts further away from a nearly three-month high, levels just above the 0.6200 level achieved on Friday. The pair have been struggling during the early hours of the European session, and it is presently edging ever-closer to the daily low at around 0.6120.
The US Dollar continues to gather momentum after recovering from its lowest point since August 12 last week, which is perceived as impacting the NZDUSD pair. The US Retail Sales report announced on Thursday exceeded expectations, raising questions about peak inflation. Additionally, hawkish indications from several Fed officials imply that the US central bank is still far from halting its cycle of tightening monetary policy and is still acting as a positive force for the dollar.
In addition, a generally gloomier outlook for the stock markets gives the safe-haven dollar a further boost and diverts capital away from the risk-averse Kiwi. The market’s mood is still shaky due to concerns about headwinds brought on by a fresh COVID-19 outbreak in China and implementing lockdowns that would hurt the economy. Apart from that, investors’ desire for supposedly riskier assets is restrained by worries about a possible escalation in the Russia-Ukraine war.
The underlying environment is in the US Dollar bulls’ favor and encourages the possibility of more intraday losses for the NZDUSD pair. However, given the dangers associated with this week’s significant events, traders could choose to withdraw from the market. On Wednesday, the Reserve Bank of New Zealand will announce its policy. The FOMC meeting minutes will then be made public. As a result, aggressive bearish traders should exercise care and prepare for a further decline.
EURUSD is expected to move around 1.0200 in the short future, according to ING.
In slack markets, the EURUSD currency pair keeps falling. According to ING economists, a change to 1.02 is imminent.
The advanced November PMIs for the eurozone, Germany, and France will be released this week in addition to the wall of speakers from the European Central Bank. The composite PMIs are predicted to be in contraction territory for all three, as a reminder that the ECB will likely end its tightening cycle at some point.
“The ECB raises rates by 50 basis points on December 15 (59 basis points are priced in the markets) and then raises rates by 25 basis points in February to end the cycle. In other words, rather than the 2.90% range valued for the markets in late summer, we expect the cycle to end at 2.25%.
GBPUSD may return to the 1.1700/1710 range this week, according to ING.
Sterling might start to step back from the spotlight after a rollercoaster journey at the end of the summer. The 1.1700/10 region may again see a decline in the GBPUSD this week, according to experts at ING.
“EURGBP is easing as the Euro seems to be bearing the more significant burden of the more pessimistic outlook of China. But 0.8665 ought to be reliable intraday support. On GBPUSD, we are more pessimistic. And unless Wednesday’s FOMC minutes reveal any unexpectedly dovish developments, GBPUSD may return to the 1.1700/1710 region this week.
“Our GBPUSD objective for year-end remains a very aggressive 1.10, mostly due to further Dollar strength,” the statement said.
USDJPY looks to be stuck between 138.50 and 142.50 – UOB
In the following weeks, USDJPY would likely trade in a range between 138.50 and 142.50, according to economist Lee Sue Ann and market strategist Quek Ser Leang from UOB Group.
View for the next 24 hours: “Last Friday, we had the opinion that the US Dollar “is unlikely to increase further” and that it would “trade between 139.50 and 140.80.” Following that, US Dollar traded inside a smaller range (139.62/140.50) than anticipated. Since momentum indicators are primarily neutral, we anticipate US Dollar to move sideways today, perhaps within a band of 139.65/140.60.
Within the next three weeks: “Our news from last Friday (November 18, spot at 140.30) remains valid. As said, the US Dollar has entered a period of stabilization and will likely trade within the area of 138.50/142.50 for the time being.
Please click here for the Market News Updates from 18 November, 2022.