Europe roundup: Euro up ahead of US inflation data, European stocks slide, gold stabilizes near 9-month low, oil edged higher after dropping below $100 – July 13, 2022

Market overview

• UK Industrial Production (monthly) in May 0.9%, forecast 0.2%, previous -0.6%

•UK trade balance in May -21.45 billion, forecast -21.20 billion, previous -20.89 billion

• UK trade balance in May excluding EU -10.37 billion, previous -10.99 billion

• UK GDP (QT) 0.4%, 0.0% forecast, 0.8% previous

• UK GDP (monthly) 0.5%, 0.1% forecast, -0.2% previous

• UK Monthly GDP 3-Month/3-Month Change 0.4%, 0.0% forecast, 0.2% previous

• UK GDP (Annual) 3.5%, forecast 2.7%, previous 8.7%

• UK Services Index 0.1%, -0.1% forecast, 0.2% previous

• German June CPI (monthly) 0.1%, 0.1% forecast, 0.9% previous

• Manufacturing output (monthly) in the UK in May 1.4%, forecast 0.1%, -0.6% previous

• French HICP June (monthly) 0.9%, 0.8% forecast, 0.8% previous

• French CPI June (monthly) 0.7%, 0.7% forecast, 0.7% previous

• EU Industrial Production in May (Annual) 1.6% 0.3% forecast, -2.0% previous

• EU Industrial Production in May (monthly) 0.8%, forecast 0.3%, previous 0.4%

Future Outlook – Economic Data (GMT)

•12:30 US June CPI (monthly) 1.1% forecast, 1.0% previous

•12:30 US Jun Core CPI (YoY) 5.7% forecast, 6.0% prior

•12:30 US Jun Core CPI (MoM) 0.6% forecast, 0.6% previous

•12:30 US Jun CPI (YoY) 8.8% forecast, 8.6% previous

• 2:30 p.m. Crude oil inventories in the United States -0.154 M forecast, 8.235 M previous

• 2:30 p.m. Gasoline stocks in the United States -0.357 M forecast, -2.497 M previous

• 14:30 Cushing’s crude oil inventories in the United States 0.069 M previous

•6:00 p.m. June US federal budget -76.5 billion forecast, -66.0 billion previous

Future Outlook – Economic Events and Other Releases (GMT)

• 2:00 p.m. Bank of Canada rate statement

•2:00 p.m. Bank of Canada Monetary Policy Report

• 2:00 p.m. Bank of Canada interest rate decision 2.25% forecast, 1.50% previous

• 3:00 p.m. Canada BOC press conference

• 6:00 p.m. US Beige Book

fxbeat

EUR/USD: The Euro was just above parity with the US Dollar on Wednesday as traders focused on US data expected later in the session which should show inflation at a 40-year high. The euro has fallen recently as investors feared aggressive monetary policy tightening could trigger a recession. Markets are speculating that June US inflation data, due at 12:30 GMT, could trigger another rally in the dollar, bringing it back to par with the single currency. The ECB, which is due to meet later this month, is expected to make its first rate hike in more than a decade. His decision will follow the Fed’s decision next week. A 75 basis point hike by the Fed will likely be fully priced in if US inflation data comes in as expected. Immediate resistance can be seen at 1.0101 (5DMA), a break up can trigger a rise towards 1.0223 (38.2% fib). On the downside, immediate support is seen at 1.0000 (psychological level), a break below could take the pair towards 0.9949 (BB lower).

GBP/USD: The pound rose slightly on Wednesday, helped by an overall weaker dollar and after data showed the UK economy grew unexpectedly in May. Economic output rose 0.5% in May, although consumer services fell as soaring inflation hit buyers. The pound was up 0.3% at $1.1937 as of 1100 GMT and was last up 0.2% at $1.1916. Against the euro, it was stable at 84.35 pence. The pound has fallen sharply in recent weeks to new two-year lows, largely on the back of the surging dollar, but also as investors worry about political uncertainty following the resignation of the British Prime Minister Boris Johnson. Immediate resistance can be seen at 1.1949 (5DMA), a break up can trigger a rise towards 1.2000 (38.2% fib). On the downside, immediate support is seen at 1.1847 (23.6% fib), a break below could take the pair towards 1.1748 (BB lower).

USD/CHF: The dollar fell against the Swiss franc on Wednesday as traders waited to see if US inflation data later supported the case for another Federal Reserve rate hike this month . Economists surveyed forecast that headline inflation in the United States accelerated to 8.8% year-on-year in June, a 40-year high, which should bolster expectations for interest rate hikes to help the economy. dollar. At (11:00 GMT), the greenback fell 0.53% against the Swiss franc to 0.9725. Immediate resistance can be seen at 0.9885 (daily high), a break up can trigger a rise towards 0.9874 (BB upper). On the downside, immediate support is seen at 0.9762 (50% fib), a break below could take the pair towards 0.9689 (11DMA).

USD/JPY: The dollar fell against the Japanese yen on Wednesday as investors took a breather ahead of US inflation data. Economists surveyed expect the Labor Department’s Consumer Price Index (CPI), which tracks the prices urban consumers spend on a basket of goods, to have accelerated in June on a monthly and annual basis. , 1.1% and 8.8%, respectively. An easing in the annual core CPI is probably the most crucial element of the report, as investors seek further confirmation that inflation has peaked, which could potentially convince the Federal Reserve not to become even more aggressive in raising interest rates. A strong resistance can be seen at 137.45 (23.6% fib), a break up can trigger a rise towards 138.26 (BB upper). On the downside, immediate support is seen at 136.15 (11 DMA), a break below could take the pair towards 134.54 (38.2% Fib).

Summary of actions

The ECB, which is due to meet later this month, is expected to make its first rate hike in more than a decade. His decision will follow the Fed’s decision next week. A 75 basis point hike by the Fed will likely be fully priced in if US inflation data comes in as expected.

At (GMT 11:43 a.m.), Britain’s benchmark FTSE 100 last traded at 0.76%, Germany’s Dax was down 0.99%, France’s CAC was down 0.79% .

Summary of raw materials

Gold prices stabilized on Wednesday after falling to a more than nine-month low as investors awaited U.S. inflation data for clues on the Federal Reserve’s policy tightening trajectory.

Spot gold rose 0.1% to $1,728.09 an ounce at 0955 GMT, after falling to its lowest level since late September at $1,721.98 earlier in the session. US gold futures also rose 0.1% to $1,726.70.

Oil edged higher on Wednesday, a day after settling below $100 a barrel for the first time since April, and gains were limited by a U.S. supply report showing rising inventories and caution ahead of US inflation data.

Brent crude rose 80 cents, or 0.8%, to $100.29 a barrel at 1120 GMT. U.S. West Texas Intermediate crude gained 74 cents, or 0.8%, to $96.58.