Market Comment – Wednesday, 27 November 2024
Markets are digesting mixed data this morning, with releases from Australia, Germany, and the US. Australia’s Monthly CPI Indicator met expectations, while Germany’s GfK Consumer Confidence showed a slight improvement. Later today, US data will dominate attention with Core PCE Price Index, Durable Goods Orders, GDP Growth Rate (Q3, second estimate), and Personal Spending figures all due for release. Energy markets are steady, and precious metals are gaining as the dollar weakens.
Key Data Out Today
- Australia Monthly CPI (Oct): Stayed at 2.1%, matching the previous reading but missing the forecast of 2.3%.
- Germany GfK Consumer Confidence (Dec): Improved to -18.3 from the prior -18.6, showing marginal improvement in sentiment.
- US Core PCE Price Index (MoM, Oct): Expected at 0.3%, a key inflation gauge for the Federal Reserve.
- US Durable Goods Orders (Oct): Previously dropped 0.7%; markets expect signs of a recovery.
- US GDP Growth Rate (Q3, second estimate): Forecasted at 2.8%, reflecting strong economic momentum.
- US Personal Income and Spending (MoM, Oct): Income expected at 0.3% and spending forecasted to decline to 0.4%.
Energy & Precious Metals
- Crude Oil and Brent: WTI rose 0.43% to $69.06 per barrel, and Brent gained 0.50% to $73.17. Prices remain steady as markets balance weaker demand concerns with OPEC production cuts.
- Natural Gas: Dropped 3.28% to $3.35/MMBtu, correcting after last week’s sharp rally driven by winter demand.
- Gold: Rose 0.55% to $2,646.69 per ounce, supported by dollar weakness and safe-haven demand ahead of US data.
- Silver: Up 0.86% to $30.67, outpacing gold in percentage terms, as industrial metals regain traction.
Currency Movements
EUR/USD
- EUR/USD: Edged up 0.09%, trading at 1.0499, as traders await US inflation and GDP figures.
GBP/USD
- GBP/USD: Gained 0.16% to 1.2589, supported by a slightly weaker dollar but capped by lingering UK growth concerns.
AUD/USD and NZD/USD
- AUD/USD and NZD/USD: Both strengthened, with AUD/USD up 0.20% to 0.6487 and NZD/USD climbing 1.04% to 0.5882, reflecting improved risk sentiment.
USD/JPY
- USD/JPY: Fell 0.76% to 151.94, as the yen strengthened sharply, likely due to safe-haven flows ahead of US data.
USD/CNY
- USD/CNY: Slightly weaker at 7.2564, down 0.02%, as markets digest China’s recent economic stabilisation efforts.
USD/CHF
- USD/CHF: Down 0.22% to 0.8846, reflecting broad dollar weakness.
USD/CAD
- USD/CAD: Flat at 1.4056, as crude oil prices lent some support to the Canadian dollar.
USD/MXN
- USD/MXN: Rose 0.16% to 20.67, with the peso under pressure from rising global uncertainty and risk aversion.
USD/INR
- USD/INR: Reached a fresh all-time low at 84.44, up 0.13% today. The rupee continues to face pressure from capital outflows, a strong dollar, and rising US yields.
Things to Keep a Watch On:
- US Data (13:30 GMT): Core PCE Price Index, GDP Growth Rate, and Durable Goods Orders will likely set the tone for markets.
- Crude Oil Prices: Ongoing OPEC production cuts and US inventory data could influence energy markets.
- Gold and Silver Trends: Any shifts in risk appetite or inflation data could further drive safe-haven demand.
- Currency Fluctuations: USD/INR: Focus remains on the rupee as it battles new lows amid persistent dollar strength. USD/JPY: Yen movements could accelerate with shifts in safe-haven flows and US data outcomes.