Markets await US CPI data

"The road to success and the road to failure are almost exactly the same." - Colin R. Davis

 

 

 

HEADLINES

 

 

 

• Dollar ticks down, euro up ahead of U.S. CPI report
• Gold rises on softer dollar, yields; U.S. inflation data in focus
• Oil rallies on big drawdown in U.S. crude stocks, strong demand
• Stocks rise as investors put aside rate hike fears
• USD/CAD to slump towards 1.26 on a break under 1.2650 – Scotiabank
• EURJPY Near Term: Upside favoured

 

 

 

FOREX

 

 

 

Dollar ticks down, euro up ahead of U.S. CPI report

 

 

The dollar slid further and the euro extended gains following a hawkish shift from the European Central Bank last week and ahead of key data on U.S. consumer prices due on Thursday.

The CPI print may offer new indications about the pace of the Federal Reserve's monetary tightening, and investors are bracing for higher-than expected numbers that would signal more aggressive rate hikes.

That readout is expected to show a 0.5% month-over-month increase in January, and 7.3% for the year, according to economists polled by Reuters.

 

 

 

COMMODITIES

 

 

 

Gold rises on softer dollar, yields; U.S. inflation data in focus

 

 

Gold eked out gains on Wednesday, helped by a weaker dollar and a retreat in U.S. Treasury yields, although prices moved in a tight range as investors refrained from making large bets ahead of U.S. inflation data.

All eyes are on U.S. consumer price data for January due on Thursday that could provide more clarity on the Federal Reserve's rate hike trajectory.

A robust inflation reading is expected to burnish gold's mettle as an inflation hedge, but U.S. interest rate increases would raise the opportunity cost of holding non-yielding bullion.

 

 

Oil rallies on big drawdown in U.S. crude stocks, strong demand

 

 

Oil prices rallied on Wednesday after U.S. crude inventories dropped by nearly 5 million barrels and fuel demand rose to an all-time high, underscoring the market's ongoing tightness.

U.S. crude stocks fell by 4.8 million barrels last week to 410.4 million barrels, their lowest since October 2018, while overall product supplied, a proxy for demand, hit a record 21.9 million barrels per day over the past four weeks, government data showed.

 

 

 

STOCKS

 

 

 

Stocks rise as investors put aside rate hike fears

 

 

World stocks rallied on Wednesday, with Wall Street rising again on a Big Tech boost and European shares gaining on strong earnings as investors put aside worries about rising interest rates for now.

The S&P 500 and the Nasdaq Composite jumped more than 1% as tech stocks extended their rally.

 

 

 

ANALYSIS

 

 

 

USD/CAD to slump towards 1.26 on a break under 1.2650 – Scotiabank

 

 

“A break under 1.2650 should see spot push back to the 1.25 area.”

“Resistance is 1.2720/30 and (key) 1.2800.” 

 

 

 

CHART

 

 

 

EURJPY Near Term: Upside favoured

 

 

Technical View: Long position above 130.5. Target 132.5. Conversely, break below 130.5, to open 130.

Comments: The pair remains supported. Further advance favored.

Source: Trading Central

 

 

 

CALENDAR

 

 

 

*Times in GMT

 

 

Source: FX Street Economic Calendar

SOURCE

https://www.fxstreet.com/economic-calendar
https://www.reuters.com/business/energy/oil-prices-nudge-up-after-api-data-shows-surprise-drop-us-stocks-2022-02-09/
https://www.fxstreet.com/news/usd-cad-to-slump-towards-126-on-a-break-under-12650-scotiabank-202202091419
https://www.reuters.com/markets/europe/gold-near-2-week-high-inflation-risks-lift-safe-haven-appeal-2022-02-09/
https://www.reuters.com/markets/europe/dollar-hits-one-month-high-yen-us-yields-rise-2022-02-09/
https://www.reuters.com/markets/europe/global-markets-wrapup-1-2022-02-09/