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ForexLive European FX morning news wrap: Xmas weekend subdues major currencies
- US stocks look to make it 8 for 8 ahead of the holidays
- UK November retail sales +1.3% vs +0.4% m/m expected
- UK Q3 final GDP -0.1% vs 0.0% q/q prelim
- Germany November import price index -0.1% vs +0.3% m/m prior
- Japan projects higher interest rates for upcoming budget for the first time in 17 years
Markets:
- CHF leads on the day
- European equities little changed; S&P 500 futures down 0.1%
- US 10-year yields down 3 bps to 3.861%
- Gold up 0.5% to $2,055.53
- WTI crude up 1.0% to $74.62
- Bitcoin down 0.7% to $43,720
Things are truly winding down in financial markets now as we approach the Christmas weekend.
Major currencies were subdued for the most part, with the dollar keeping lightly changed overall but set to end the week lower once again. USD/CHF did ease to its lowest level since 2015 as the pair looks to break the July lows of 0.8550-55.
Besides that, there wasn’t much action even with a strong beat on UK retail sales. GBP/USD is slightly higher by 0.2% to 1.2710 but nothing out of the ordinary on the day.
In other markets, bond yields continue to be pinned down while equities look like it is already in holiday mood. That being said, Wall Street is in the hunt to make it eight straight weeks of gains and look to tee up a potential upside break heading into the new year.
But for now, the festive period is going to keep things on ice in all likelihood. I wish everyone the best of holidays and a very Merry Christmas to those celebrating! Have a wonderful weekend. 🙂
This article was written by Justin Low at www.forexlive.com.
Oil set to end the year lower but it could’ve been worse
It has been a rather challenging year for oil. From talks of tighter market conditions to slowing economies across the globe, there were arguments to both sides of the story. And that is also reflected somewhat in price action, with the high for WTI crude being at $95 at the end of September before sinking back lower in the past two months as markets step up rate cuts pricing.
The fortunate thing for oil prices is that buyers have stepped up when it mattered most. At each point during the course of the year the 200-week moving average (green line) was tested, they managed to keep a defense of that. And even when things were looking rather gloomy last week, they managed to barely turn it around towards the end.
And so for this year, oil is still down over 7% but if not for the defense at the 200-week moving average seen above, it really could’ve been much worse.
So, what’s next as we move towards 2024?
The outlook is mostly leaning towards bearish side amid economic and energy-transition headwinds. As such, OPEC+ will have an important role in trying to at least keep a floor on prices with deeper production cuts. That being said, if economic conditions aren’t as bad as feared, that could still stimulate higher demand and keep the market tight. That is one consideration to be mindful about, especially since lower prices will also help to lift demand conditions in general.
This article was written by Justin Low at www.forexlive.com.