ECB Rate Decision and US PPI Impact on Markets
Today attention is on the European Central Banks (ECB) rate decision and U.S. PPI data. Energy prices are stable. Metals are showing mixed trends and Currency pairs are reflecting a cautious mood ahead of these key updates.
Key Data Out Today
- European Central Bank (ECB):
- Main Refinancing Rate expected: 3.15% (previous: 3.4%)
- Deposit Facility Rate forecast: 3%
- U.S. Economic Data:
- Initial Jobless Claims: Expected at 220K (previous: 224K)
- PPI MoM and YoY (November): Forecast at 0.2% (unchanged) and 2.6% (previous: 2.4%), respectively.
- Core PPI YoY: Expected at 3.2%.
- New Zealand PMI:
- Business PMI expected to decline slightly (previous: 45.8).
Energy & Precious Metals
- Crude Oil (USD/Bbl): Trading at $70.457, up 0.24% day-over-day, marking a 3.16% weekly increase.
- Brent Oil (USD/Bbl): At $73.756, up 0.32% from the previous day, with a 2.31% weekly rise.
- Gold (USD/t.oz): Valued at $2,718.66, nearly unchanged day-over-day, showing a 3.23% weekly increase.
- Silver (USD/t.oz): At $32.127, up 0.66% daily and 2.50% over the week.
Currency Movements
EUR/USD
- EUR/USD: Trading at 1.05226, up 0.26% day-over-day. The euro remains steady ahead of the European Central Bank’s upcoming monetary policy decision.
GBP/USD
- GBP/USD: At 1.27798, increasing by 0.23% from the previous day. The pound has reached a 20-month high against the euro, influenced by expectations of interest rate cuts in the Eurozone.
AUD/USD
- AUD/USD: Trading at 0.64215, up 0.82% day-over-day. The Australian dollar has strengthened due to stronger-than-expected domestic employment data, indicating a robust labor market.
NZD/USD
- NZD/USD: At 0.58111, rising 0.48% from the previous day.
USD/JPY
- USD/JPY: Trading at 152.401, a slight 0.03% daily decrease. The yen has declined following reports that the Bank of Japan may keep its rates unchanged. Reuters
USD/CNY
- USD/CNY: At 7.26189, down 0.24% day-over-day. The yuan faces depreciation pressure. Reports suggest that China might allow its currency to weaken in 2025. This move would counteract potential U.S. tariffs. Reuters
USD/CHF
- USD/CHF: Trading at 0.88205, decreasing by 0.30% from the previous day. The Swiss franc strengthens as investors turn to safe-haven assets ahead of U.S. inflation data.
USD/CAD
- USD/CAD: At 1.41433, down 0.11% day-over-day. Rising oil prices support the Canadian dollar, while markets eye U.S. economic updates.
USD/MXN
- USD/MXN: Trading at 20.1148, a 0.12% daily decrease. The peso benefits from carry trade demand and strong remittance inflows.
USD/INR
- USD/INR: At 84.8491, up 0.03% from the previous day. The rupee faces pressure from higher oil prices but is stabilized by foreign investment inflows.
Things to Keep a Watch On:
- Federal Reserve Meeting: Investors anticipate a potential interest rate cut in the upcoming meeting, influenced by recent inflation data.
- European Central Bank Decision: Markets await the ECB’s policy stance amid economic challenges in the Eurozone.
- China’s Currency Policy: Reports suggest China may allow the yuan to weaken in 2025 to counteract potential U.S. tariffs, impacting global currency markets.