<p><a target=“_blank“ href=“https://PiQSuite.com/Suite/reuters/2023:newsml_KBN2VQ0LJ“ target=“_blank“ rel=“nofollow“>The European Central Bank must continue to raise interest rates and should speed up the reduction of its balance sheet as rapid wage growth is putting upward pressure on an already high inflation rate, Bundesbank President Joachim Nagel said on Friday.</a></p><p>ECB’s Nagel is on the wires:</p><p>It is necessary to raise policy rates to sufficiently restrictive levels, the wind down should accelerate from Q3.</p><p>The recent wage deals are inconsistent with price stability and are to prolong the prevailing period of high inflation.</p><p>There are signs of second-round effects from <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ class=“terms__main-term“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa“>inflation</a>-induced higher wage increases back to prices.</p><p>The labour market is to remain tight, labour shortages are obstacles to production.</p>

This article was written by Ryan Paisey at www.forexlive.com.

<p><a target=“_blank“ href=“https://PiQSuite.com/Suite/reuters/2023:newsml_KBN2VP0S6″ target=“_blank“ rel=“nofollow“>Reuters report that Italy is preparing a new package of measures worth around 5 billion euros ($5.5 billion) to help businesses and families cope with costly energy bills which it plans to announce next week, two government sources told Reuters on Thursday.</a></p><p>- Not exactly deflationary is it…. </p><p>Rome now wants to extend and review these measures in a decree expected to be approved by the cabinet on March 28, the sources said, asking not to be named due to the sensitivity of the matter. As part of the package, the Treasury plans to extend until June an existing bonus aimed at cutting energy bills paid by low-income households.Moreover, Rome intends to change a tax break to cut energy costs for firms, making it available only if the price of methane exceeds a certain threshold still to be defined.</p><p>Gas prices have fallen in recent months, with the Dutch TTF hub hovering around 41 euros per megawatt hour (MWh), sharply down from 73 euros in early 2023.</p><p>I’m sure the ECB are thrilled by this</p>

This article was written by Ryan Paisey at www.forexlive.com.

<p>On the daily chart below, we can
see that the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>resistance</a> at 11829, which was the last
line of defence for the sellers, eventually held. The buyers couldn’t sustain
the breakout and failed, leaving on the chart a fakeout. </p><p>This was caused by the <a target=“_blank“ href=“https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-fed-hikes-25-basis-points-dollar-initially-falls-20230322/“>FOMC
decision</a> yesterday where the Fed hiked rates by 25 bps and kept everything
unchanged, including the QT and the Dot Plot signalling no rate cuts for this
year, even though the market has priced for ones. </p><p>This indicates that the Fed is
resolute in bringing inflation down to their 2% target and sees also risks
around the banking sector that the market may have not yet fully grasped. This
should be bad for risk sentiment, but the buyers have demonstrated time after
time that optimists can be strong. </p><p>On the 4 hour chart below, we can
see that the selloff was quite strong yesterday after the Fed’s decision. We
may see the sellers again in control today once the market opens, but
ultimately it may all hang on the economic data going forward to see if the
Fed’s worries are justified. </p><p>Today the only data we have is <a target=“_blank“ href=“https://www.forexlive.com/EconomicCalendar“>Jobless Claims</a>. It’s likely that a strong
reading would be enough for the buyers to step in, while a bad one may increase
the fears and lead to risk off. </p><p>On the 1 hour chart below, we can
see the possible <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>support</a> levels for the buyers. The first
one is the 38.2% <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/“>Fibonacci
retracement</a> level, while the second one is the 50% level where
we have also the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-confluence-20220318/“>confluence</a> with the previous strong 11492
level and the broken <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/“>trendline</a>. </p><p>The sellers, on the other hand,
will be watching carefully if the price goes back below the trendline and the
11492 support as that would give them even more conviction to jump in. </p>

This article was written by ForexLive at www.forexlive.com.

<p>Turkish central bank leaves one-week repo rate unchanged at 8.5 pct</p><p>Turkish Central Bank: </p><p>To Prioritize The Creation Of Supportive Financial Conditions In Order To Minimize The Effects Of The Earthquake And Support The Necessary Recovery</p><p>Current Monetary Policy Stance Is Adequate To Support The Necessary Recovery </p><p>Policy, Particularly Funding Channels Will Be Aligned With Liraization Targets</p><p>Decision To Keep Financial Conditions Supportive To Preserve The Growth Momentum In Industrial Production </p><p>Level And Underlying Trend Of Inflation Have Been Improved With The Support Of The Implemented Integrated Policy </p><p>Effects Of The Earthquake In The First Half Of 2023 Will Be Closely Monitored</p>

This article was written by Ryan Paisey at www.forexlive.com.

<p><a target=“_blank“ href=“https://newsquawk.com/daily/article/?id=2919-us-market-open-us-futures-firmer-dxy-downbeat-fixed-offbest-after-hawkish-snbnorges-action“ target=“_blank“ rel=“nofollow“>Newsquawk’s US Market Open: US futures firmer &amp; DXY downbeat; fixed off-best after hawkish SNB/Norges action</a></p><p>6 Things You Need to Know</p><p>
European bourses are softer while US futures are firmer, but still shy of Wednesday’s best levels.
</p><p>USD remains on the backfoot after Wednesday’s FOMC, Antipodeans lead and GBP rises pre-BoE.
</p><p>CHF and NOK benefitted from 50bp and 25bp hikes respectively; EGBs remain underpinned but off best following the hawkish action.
</p><p>USTs remain firmer with yields lower across the curve but slightly above the mid-week trough.
</p><p>Commodities are mixed, with the crude benchmarks attempting to pare back some of their overnight losses while metals glean support from the USD’s downside.
</p><p>US Treasury Secretary Yellen stated that it is worthwhile for Congress to discuss changes to the FDIC deposit insurance and the Treasury is ready to work with lawmakers
6 Things You Need to Know </p>

This article was written by Ryan Paisey at www.forexlive.com.

<p>On the daily chart below, we can
see that the market found <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/“>support</a> at the 1731 level and started to
range as buyers and sellers try to prevail on each other. The <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/“>moving
averages</a> are still clearly crossed to the downside indicating a downtrend. </p><p>The <a target=“_blank“ href=“https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-fed-hikes-25-basis-points-dollar-initially-falls-20230322/“>Fed
yesterday</a> didn’t offer much support for the market as they hiked by 25 bps and
kept everything unchanged, including QT and no rate cuts for this year besides
the market pricing for ones. This should indicate that they are still resolute
on bringing inflation down to their 2% target and that they may be seeing risks
in the economy that the market has not yet fully priced in. </p><p>On the 4
hour chart below, we can see more closely the range created between the support
at 1731 and the resistance at 1800 where we can also find the 38.2% <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/“>Fibonacci
retracement</a> level of the entire selloff. </p><p>The
sellers leant again on the resistance and extended the fall as the Fed kept on
its tightening path, although they were less hawkish this time as risks around
the banking sector forced them to be cautious. </p><p>On the 1 hour chart, we can see
that the price has now pulled back a bit since yesterday’s selloff and it’s now
at the 38.2% Fibonacci retracement level. We have also the red long period
moving average here for <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-confluence-20220318/“>confluence</a>, so we should see the sellers
piling in here or the 50% Fibonacci level. </p><p>The target on the downside would
be first the support of the range and second new lower lows. The buyers, on the
other hand, will need to break above the 61.8% Fibonacci level to target again
the resistance and try a breakout to the upside. </p>

This article was written by ForexLive at www.forexlive.com.

<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/uk-february-cpi-104-vs-99-yy-expected-20230322/“>UK February CPI +10.4% vs +9.9% y/y expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/hot-uk-inflation-data-adds-to-headache-for-boe-20230322/“>Hot UK inflation data adds to headache for BOE</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/cable-at-seven-week-highs-ahead-of-the-boe-tomorrow-20230322/“>Cable at seven-week highs ahead of the BOE tomorrow</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/ecbs-lagarde-we-are-neither-committed-to-raise-further-nor-are-we-finished-on-rate-hikes-20230322/“>ECB’s Lagarde: We are neither committed to raise further nor are we finished on rate hikes</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/ecbs-lane-there-are-reasons-to-believe-underlying-inflation-measures-will-ease-over-time-20230322/“>ECB’s Lane: There are reasons to believe underlying inflation measures will ease over time</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/centralbank/ecbs-nagel-backs-further-rate-hikes-plays-down-banking-turmoil-20230322/“>ECB’s Nagel backs further rate hikes, plays down banking turmoil</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurozone-january-current-account-balance-170-billion-vs-159-billion-prior-20230322/“>Eurozone January current account balance €17.0 billion vs €15.9 billion prior</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/opec-reportedly-likely-to-stick-to-existing-deal-until-the-end-of-the-year-20230322/“>OPEC+ reportedly likely to stick to existing deal until the end of the year</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/uk-march-cbi-trends-total-orders-20-vs-15-expected-20230322/“>UK March CBI trends total orders -20 vs -15 expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/us-mba-mortgage-applications-we-17-march-30-vs-65-prior-20230322/“>US MBA mortgage applications w.e. 17 March +3.0% vs +6.5% prior</a></li></ul><p>Markets:</p><ul><li>GBP leads, JPY lags on the day</li><li>European equities slightly higher; S&amp;P 500 futures flat</li><li>US 10-year yields up 1.5 bps to 3.62%</li><li>Gold up 0.1% to $1,941.83</li><li>WTI crude down 0.3% to $69.45</li><li>Bitcoin up 0.2% to $28,190</li></ul><p style=““ class=“text-align-justify“><a target=“_blank“ href=“https://www.forexlive.com/news/welcome-to-fed-day-20230322/“ target=“_blank“ rel=“follow“>It’s all about the Fed today</a> and broader market sentiment is more pensive in general, though the overall mood is steady.</p><p style=““ class=“text-align-justify“>That comes after the risk recovery in the past two days but now markets will have to pass the Fed test to see what comes next. The banking turmoil may have subsided but the Fed could very well reignite some fears and anxiety again later before all is said and done.</p><p style=““ class=“text-align-justify“>As such, equities didn’t do a whole lot with bond yields also considerably little changed after a volatile last two weeks.</p><p style=““ class=“text-align-justify“>Instead, it was the pound who stole the focus as UK inflation surprisingly runs hot in February as food prices jump by the highest since 1977. Headline annual inflation moved back into double-digits and core inflation shot above 6%, and that helped to underpin the pound in European morning trade.</p><p style=““ class=“text-align-justify“>Coming into today, markets were just expecting one more rate hike by the BOE this week before heading to the sidelines. But after the data, another 25 bps is now priced in for May and that is now the peak for rates based on the OIS market.</p><p style=““ class=“text-align-justify“>GBP/USD moved up from 1.2230 to near 1.2300 before backing off slightly, sitting around 1.2260-80 mostly now.</p><p style=““ class=“text-align-justify“>Elsewhere, the dollar is just a touch lower against the euro and the antipodeans though the ranges for the day are leaving a lot to be desired. EUR/USD entered into the session sitting around 1.0770 but is now seen pushing towards 1.0800.</p><p style=““ class=“text-align-justify“>Now, on to the Fed next.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>I already shared my thoughts earlier in the day <a target=“_blank“ href=“https://www.forexlive.com/news/welcome-to-fed-day-20230322/“ target=“_blank“ rel=“follow“>here</a>. And as at time of writing, Fed funds futures are reflecting roughly 86% odds of a 25 bps rate hike. It’s been a while since we last had such uncertainty heading into a FOMC meeting but here we actually are. These are the latest calls from the punters big boys ahead of the main event (h/t @ <a target=“_blank“ href=“https://twitter.com/BrianSozzi“ target=“_blank“ rel=“nofollow“>Brian Sozzi</a>):</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>That comes despite the latest slump in prices, in which we saw WTI crude break back below $70 this week. The sources reported say that OPEC+ is to stick to its deal on output cuts of 2 million bpd until year-end. For now, it looks like Russia is the only one acting to cut down on production.</p><p style=““ class=“text-align-justify“>“This is only a unilateral cut of Russia. No changes for the group until the end of year.“</p><p style=““ class=“text-align-justify“>That’s according to one of the delegates, with the other saying that no further output cuts were planned for now.</p>

This article was written by Justin Low at www.forexlive.com.

<p>On the daily chart below, we can
see the incredibly strong and fast rally in gold that started as the Silicon
Valley Bank failed. The fears around the banking sector caused not only a
flight to safety into gold, but also a fast repricing lower in interest rates
expectations that brought down real yields and ultimately favoured the precious
metal. </p><p>As the fears faded due to the
emergency actions taken by the central banks, the buying momentum started to
weaken and led to a correction. The rally was anyway overstretched as signalled
by the distance between the price and the blue short term <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/“>moving
average</a> and the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/“>divergence</a> with the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/“>MACD</a>. </p><p>On the 4 hour chart below, we can
see that the break below the <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-trendlines-20220406/“>trendline</a> gave the sellers some control.
The moving averages crossed to the downside as the selling momentum
intensified. It may be an early signal of a change in trend, but the next
direction will be decided by the <a target=“_blank“ href=“https://www.forexlive.com/news/welcome-to-fed-day-20230322/“>FOMC
decision</a> and the economic data in the next few weeks. It’s likely that we will
see another selloff in case the Fed sounds hawkish, while a dovish outcome
would give the buyers again control. </p><p>On the 1 hour chart below, we can
see a clear setup for both buyers and sellers. The buyers will want to see the
price to break above the trendline to start piling in and extend the rally
towards new higher highs. The sellers, on the other hand, are likely to lean on
the trendline where there is <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-confluence-20220318/“>confluence</a> with a 38.2% <a target=“_blank“ href=“https://www.forexlive.com/Education/technical-analysis-using-fibonacci-retracements-20220421/“>Fibonacci
retracement</a> level and the red long period moving average. </p>

This article was written by ForexLive at www.forexlive.com.