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Euro gains after Macron debate win

“If you really look closely, most overnight successes took a long time.” – Steve Jobs

 

 

HEADLINES

 

 

  • Euro gains on ECB rate hike view, Macron optimism
  • Gold retreats 1% on elevated yields as Fed rate hikes loom
  • Oil climbs following loss in previous session
  • Wall Streets sinks, bond yields up as Powell suggests aggressive Fed policy
  • EUR/USD to push back to the 1.10 pivot into the summer and beyond – Rabobank
  • GBPJPY Near Term: Downside favored

 

 

FOREX

 

 

Euro gains on ECB rate hike view, Macron optimism

 

The euro rose to a more than one-week high on Thursday against the dollar after a spate of hawkish comments from European Central Bank officials raised bets that euro zone interest rates will rise soon.

Expectations that French President Emmanuel Macron would win his re-election bid on Sunday also supported the single European currency.

 

 

COMMODITIES

 

 

Gold retreats 1% on elevated yields as Fed rate hikes loom

 

Gold slipped 1% to a two-week low on Thursday, pressured by elevated U.S. Treasury yields and firmer risk appetite, with investors expecting aggressive policy tightening by the Federal Reserve.

Gold is seeing a correction since the market is expecting the Fed to be more aggressive in hiking rates, while yields are also moving up, said Bart Melek, head of commodity strategies at TD Securities.

While gold is considered a hedge against inflation, rising interest rates increase the opportunity cost of holding non-yielding bullion.

 

Oil climbs following loss in previous session

 

Oil prices traded higher but in a narrow range on Thursday, after being rocked earlier in the week by supply losses from Libya and a worrying outlook for demand as the International Monetary Fund cut its global growth forecasts.

Libya, a member of OPEC, on Wednesday said the country was losing more than 550,000 barrels per day of oil output due to blockades at major fields and export terminals.



 

STOCKS

 

 

Wall Streets sinks, bond yields up as Powell suggests aggressive Fed policy

 

Wall Street reversed course and turned negative on Thursday and bond yields surged as Federal Reserve Chairman Jerome Powell suggested the U.S. central bank would move aggressively to curb inflation.

U.S. stocks opened strong, buoyed by corporate earnings and strong jobless data, but began to retreat ahead of Powell's afternoon remarks as investor concerns about central banks' inflation fight took center stage.

Bond yields were on the upswing Thursday, with the benchmark 10-year Treasury yields climbing to 2.9347% after Wednesday's high of 2.981%, which had been the highest since December 2018.

 

 

ANALYSIS

 

 

EUR/USD to push back to the 1.10 pivot into the summer and beyond – Rabobank 

 

“Around four European Central Bank (ECB) officials have indicated that rates could be raised in Q3. there is a clear sense that the Governing Council may be opening up the prospect of a rate move a little earlier than many economists have been expecting.”

“Assuming a win by the incumbent in France’s run-off election, the EUR could benefit further from relief.” 

“Our short-term forecast of EUR/USD 1.08 was breached earlier this week. We expect EUR/USD to push back to its 1.10 pivot into the summer and beyond.” 

 

 

CHART

 

 

GBPJPY Near Term: Downside favored

Technical View: Short position below 168.05. Target 165.95. Conversely, break above 168.05, to open 168.7.

Comments: The pair is expected to resume descend after correction.

Source: Trading Central
 

 

CALENDAR

 

 

*Times in GMT

 

Source: FX Street Economic Calendar


SOURCES

https://www.cnbc.com/2022/04/21/forex-markets-federal-reserve-monetary-policy.html
https://www.cnbc.com/2022/04/21/gold-markets-us-bond-yields-russia-ukraine-war.html
https://www.cnbc.com/2022/04/21/oil-markets-demand-outlook-imf-global-growth-forecast.html
https://www.reuters.com/business/global-markets-wrapup-1-2022-04-21/
https://www.fxstreet.com/news/eur-usd-to-push-back-to-the-110-pivot-into-the-summer-and-beyond-rabobank-202204211427

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