Новини ринків

“(It is) premature to shift policy as smaller firms becoming keen to hike wages, invest more,” per the Summary of Opinions for Bank of Japan’s (BoJ) monetary policy meeting held in June reported Reuters.

Key statements

USD/JPY remains pressured

Despite the dovish Summary of Opinions, the USD/JPY pair remains pressured around 143.50 as it pares the latest gains at the highest levels since November 2022. It’s worth noting that comments about the Yield Curve Control (YCC) policy seemed to have trigger the Japanese Yen’s (JPY) corrective bounce.

Also read: Japan Top FX Diplomat Kanda: Recent Yen moves are rapid

• AUD/USD remains sidelined after posting the biggest weekly loss since August 2022.
• Fears of RBA’s less hawkish capacity versus Fed, global growth fears weigh on Aussie pair.
• Weekend news from China, Russia puts a floor under the risk-barometer pair.
• Inflation clues from Australia, US and central bankers’ speeches eyed for clear directions.

AUD/USD licks its wounds at the lowest levels in a fortnight, making rounds to 0.6680-85 after falling the most in 10 months the previous week. In doing so, the Aussie pair struggles to justify the mildly positive sentiment in the market, mainly due to the weekend news from Russia and China, amid fears of easing divergence between the Reserve Bank of Australia (RBA) and the Federal Reserve (Fed).

The doubts about Russian President Vladimir Putin’s power in Moscow and hopes of major stimulus from China allowed trades to witness cautious optimism on early Monday and weighed on the US Dollar.

“Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin's grip on power,” said Reuters in this regard.

On the other hand, Ning Jizhe, deputy head of the economic committee of the Chinese People's Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns about sooner stimulus from China and allowed the AUD/USD to rebound, due to its business ties with Beijing. “China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world's second-largest economy,” said China’s Ning Jizhe per Reuters.

However, headlines suggesting major investors’ pause in China optimism join hawkish comments from the Fed officials and comparatively upbeat US data to weigh on the AUD/USD price.

“Investors are waiting for a big burst of stimulus from China before they make more aggressive bets on a recovery, having spent the past few months disappointed by economic data and a lack of meaningful policy response from Beijing, said Reuters.

It should be noted that the Fed officials rush towards suggesting two more rate hikes from the US after witnessing upbeat data. On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being lesser than the 54.9 previous monthly figure. With this, the Composite PMI declined to 53.0 versus 54.4 market forecasts and 54.3 prior.

Amid these plays, S&P500 Futures rise 0.20% intraday near 4,400 despite witnessing a downbeat week for Wall Street and gains of the US Treasury bond yields.

Looking ahead, Australia’s inflation and Retail Sales numbers will join the Core Personal Consumption and Expenditure (PCE) data, the Fed’s preferred inflation barometer, to direct this week’s AUD/USD moves. Also important to watch will be speeches of the top-tier central bankers at the European Central Bank (ECB) Forum, as well as the US Bank Stress Test results.

Technical analysis

Despite the latest corrective bounce, AUD/USD remains bearish unless providing a daily closing beyond the 200-DMA, around 0.6695 by the press time. That said, the Aussie pair’s fresh downside can aim for the key support line stretched from early March surrounding 0.6625.

• EUR/USD consolidates the biggest daily loss in five weeks, the first weekly on in four amid market’s cautious optimism.
• Weekend news from Russia, China allow Euro bears to take a breather.
• Inflation clues from Germany, Eurozone and US will be crucial to watch, central bankers’ speeches from ECB Forum eyed too.

EUR/USD prints mild gains around 1.0900 as it begins the trading week on a firmer footing after teasing bears in the last week. In doing so, the Euro pair pares the biggest daily loss in five weeks as the weekend headlines allow traders to take a sigh of relief after witnessing a risk-off mood in the last week. Also underpinning the major currency pair’s rebound could be the consolidation ahead of this week’s top-tier inflation data and central bankers’ speeches from the US and Europe.

Talking about the weekend news, doubts about Russian President Vladimir Putin’s power in Moscow and hopes of major stimulus from China allowed trades to witness cautious optimism on early Monday and weighed on the US Dollar.

“Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin's grip on power,” said Reuters in this regard.

On the other hand, Ning Jizhe, deputy head of the economic committee of the Chinese People's Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns about sooner stimulus from China and allowed the EUR/USD to rebound, due to its business ties with Beijing. “China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world's second-largest economy,” said China’s Ning Jizhe per Reuters.

Even so, downbeat PMIs from Europe and Germany, versus not-so-disappointing activity data from the US, join the broad fears of recession to keep the EUR/USD bears hopeful.

On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being lesser than the 54.9 previous monthly figure. With this, the Composite PMI declined to 53.0 versus 54.4 market forecasts and 54.3 prior.

Following the data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said, “Any further rate hikes will of course have a further dampening effect on this sector (services) which is especially susceptible to changes in borrowing costs." That said, Federal Reserve Bank of San Francisco President Mary Daly told Reuters on Friday that two more interest rate increases this year would be a "very reasonable projection."

At home, the preliminary readings of Germany’s HCOB PMIs for June were downbeat. That said, the Manufacturing gauge worsened to 41.0 versus 43.5 expected and 43.2 prior whereas Services PMI also dropped to 54.1 from 57.2 previous readings and 56.2 market forecasts. With this, the Composite PMI dropped to 50.8 from 53.9 prior and 53.5 analysts’ estimations. On the same line, Eurozone HCOB PMIs were also downbeat as the headlines Manufacturing PMI dropped to 43.6 from 44.8 expected and prior while the Services PMI dropped to 52.4 versus 54.5 market forecasts and 55.1 prior. Further, the Composite PMI declined to 50.3 compared to 52.5 expected and 52.8 prior.

While portraying the mood, S&P500 Futures rise 0.20% intraday near 4,400 despite witnessing a downbeat week for Wall Street and gains of the US Treasury bond yields.

Moving on, Eurozone’s preliminary inflation report for June and the US Core Personal Consumption and Expenditure (PCE) data will be crucial to watch for clear directions. Also important will be speeches of the top-tier central bankers at the European Central Bank (ECB) Forum, as well as the US Bank Stress Test results.

Also read: EUR/USD Weekly Forecast: Bulls hesitate as concerns arise

Technical analysis

Failure to provide a daily closing below the 50-DMA, around 1.0870 by the press time, joins the nearly oversold RSI (14) line to trigger the EUR/USD pair’s bounce towards the 10-DMA hurdle of 1.0920.

“FX should move stably reflecting fundamentals,” Japan’s top currency diplomat Masato Kanda said on Monday per Reuters.

Additional comments from Kanda

USD/JPY retreats from yearly top

The news flags expectations of Japan’s market intervention and join the weekend news to prod USD/JPY bulls at the highest levels since November 2022, mildly offered near 143.55-60 at the latest. The Yen traders, however, remain cautious ahead of the Bank of Japan (BoJ) Summary of Opinions amid concerns of the Japanese central bank’s exit from the ultra-easy monetary policy.

Also read: Weekend News: Russia, China and SNB’s Jordan were in focus

Not only was the central bank filled volatile week but the weekend updates were also interesting and allowed traders to consolidate the previous moves amid early Monday. Among them, headlines surrounding Russia, China and the Swiss National Bank (SNB) gained major attention.

Doubts over Putin’s power ease geopolitical woes

“Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin's grip on power,” said Reuters.

The news also states that fighters of the Wagner group began heading back to their bases late on Saturday in return for guarantees of their safety. “Their commander, Yevgeny Prigozhin, will move to Belarus under the deal mediated by Belarusian President Alexander Lukashenko,” adds Reuters.

While reacting to the news, U.S. Secretary of State Antony Blinken suggested the turmoil in Russia could take months to play out, while Italy's foreign minister said it had shattered the "myth" of Russian unity, per the news.

Hopes of sooner China stimulus gain strength

Apart from the likely challenges to the Russia-Ukraine woes, the recent push for China stimulus from a senior economic official with the country's top political advisory body also allowed the Antipodeans to begin the trading week on a front foot.

“China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world's second-largest economy,” said Ning Jizhe, deputy head of the economic committee of the Chinese People's Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC).

China's economy faces heavy downward pressure and its recovery is unstable and imbalanced, said Ning, who is also a former head of the National Bureau of Statistics.

The strength of macroeconomic measures "ought not be small" to prevent "an economic spiral contraction" in a global slowdown, said Ning.

SNB’s Jordan flags further rate hikes

Swiss National Bank (SNB) Chairman Thomas Jordan flagged further interest rate hikes in an interview aired by Swiss broadcaster SRF on Saturday, per Reuters.

“SNB's recent interest rate hike was ‘very likely not quite’ enough to get a grip on inflation in Switzerland,” SNB’s Jordan adds per the news.

The news also said that SNB’s Jordan also spoke of the recent rescue of Credit Suisse, which was taken over by Swiss rival UBS and given access to more than 200 billion Swiss francs ($223 billion) in financial guarantees.

Also read: Gold Price Forecast: XAU/USD portrays bearish consolidation on growth, geopolitical clues, US inflation eyed

• NZD/USD jumps half a percent to begin the trading week after snapping three-week downtrend in the last.
• Risk-positive headlines from Russia, China allow the Kiwi pair to consolidate recent losses.
• US inflation clues, multiple central bankers’ speeches and geopolitical clues eyed for clear directions.

NZD/USD begins the trading week on a front foot, after posting the first weekly loss on four, as weekend news suggests fewer challenges to the risk appetite and allows the Kiwi pair to consolidate the latest moves. That said, the quote seesaws around 0.6850 after posting a gap-up opening amid early Monday in Asia.

Among the key catalysts, doubts about Russian President Vladimir Putin’s power in Moscow and hopes of major stimulus from China gained major attention of late.

“Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin's grip on power,” said Reuters in this regard.

On the other hand, Ning Jizhe, deputy head of the economic committee of the Chinese People's Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns about sooner stimulus from China and allowed the NZD/USD to rebound, due to its business ties with Beijing. “China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world's second-largest economy,” said China’s Ning Jizhe per Reuters.

However, growth concerns and hawkish Federal Reserve expectations keep the Kiwi buyers chained as the latest round of global economics backed slowdown fears while the US data have been upbeat and suggest two-more rate hikes.

On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being lesser than the 54.9 previous monthly figure. With this, the Composite PMI declined to 53.0 versus 54.4 market forecasts and 54.3 prior.

Following the data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said, “Any further rate hikes will of course have a further dampening effect on this sector (services) which is especially susceptible to changes in borrowing costs."

Federal Reserve Bank of San Francisco President Mary Daly told Reuters on Friday that two more interest rate increases this year would be a "very reasonable projection."

Amid these plays, Wall Street benchmarks drop and the US Treasury bond yields grind higher, which in turn puts a floor under the US Dollar and exerts downside pressure on the NZD/USD.

Moving on, central bankers’ speeches at the ECB Forum and the US Core Personal Consumption and Expenditure (PCE) data, the Fed’s preferred inflation gauge, will be crucial to watch for market players.

Technical analysis

NZD/USD bounces off a one-month-old ascending support line, near 0.6130 at the latest, but the recovery remains elusive unless crossing the 200-DMA on a daily closing basis, around 0.6160 at the latest.

• Gold Price licks its wounds at the lowest levels in 3.5 months as risk-aversion amplifies.
• Geopolitical fears join hawkish Fed bets, growth concerns to weigh on XAU/USD price.
• Gold Price drops as mixed United States data versus downbeat figures from elsewhere underpin US Dollar demand.
• US inflation clues eyed for clear directions, multiple central bankers’ speeches also important to watch.

Gold Price (XAU/USD) prints corrective bounce from the lowest levels since early March, marked the previous week, as traders consolidate the previous week’s loss, the heaviest since latest January amid mixed concerns about the global growth and geopolitics. Also allowing the Gold Price to recover to $1,923 is the consolidation ahead of this week’s United States inflation clues and speech from various central bankers including those from the Federal Reserve (Fed), European Central Bank (ECB) and the Bank of England (BoE).

Gold Price stays on the bear’s radar amid growth fears

Gold Price remains on the back foot despite the latest rebound as fears of global economic slowdown, unveiled through the higher rates and sluggish statistics, underpin the US Dollar’s haven demand.

During the last week, multiple central banks from the UK, Europe, Turkiye and Switzerland have announced rate hikes and bolstered fears of higher rates when the economies aren’t performing well.

That said, Friday’s preliminary readings of the Purchasing Managers Indexes (PMIs) for the key economies were mostly down outside the US. The same allowed the US Dollar Index (DXY) to have additional strength and cheer the risk-off mood, which in turn exert downside pressure on the Gold Price.

On Friday, US S&P Global PMIs for June came in mixed as the Manufacturing PMI dropped to 46.3 from 48.4 prior, versus 48.5 expected, whereas the Services PMI improved to 54.1 from 54.0 expected despite being lesser than the 54.9 previous monthly figure. With this, the Composite PMI declined to 53.0 versus 54.4 market forecsts and 54.3 prior.

Following the data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said, “Any further rate hikes will of course have a further dampening effect on this sector (services) which is especially susceptible to changes in borrowing costs."

Federal Reserve Bank of San Francisco President Mary Daly told Reuters on Friday that two more interest rate increases this year would be a "very reasonable projection."

Elsewhere, the preliminary readings of Germany’s HCOB PMIs for June were downbeat. That said, the Manufacturing gauge worsened to 41.0 versus 43.5 expected and 43.2 prior whereas Services PMI also dropped to 54.1 from 57.2 previous readings and 56.2 market forecasts. With this, the Composite PMI dropped to 50.8 from 53.9 prior and 53.5 analysts’ estimations. On the same line, Eurozone HCOB PMIs were also downbeat as the headlines Manufacturing PMI dropped to 43.6 from 44.8 expected and prior while the Services PMI dropped to 52.4 versus 54.5 market forecasts and 55.1 prior. Further, the Composite PMI declined to 50.3 compared to 52.5 expected and 52.8 prior.

Furthermore, the UK’s S&P Global/CIPS PMIs for June came in downbeat as the Manufacturing PMI dropped to 46.2 versus 46.8 expected and 47.1 prior whereas the Services PMI also eased to 53.7 from 54.8 market forecasts and 55.2 previous readings. With this, the Composite PMI came in as 52.8 versus 53.6 market forecasts and 54.0 prior.

Hence, the PMIs were mostly downbeat and backed fears of recession but the US policymakers appear hawkish and witness less disappointment from the data. With this, the Gold Price has to bear the burden of the upbeat US Dollar.

Geopolitical fears also weigh on XAU/USD despite China optimism

Apart from the growth concerns and hawkish Federal Reserve expectations, the Gold Price also bear the burden of the geopolitical concerns in Russia. In this regard, Reuters said, “Heavily armed Russian mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on Moscow but raised questions on Sunday about President Vladimir Putin's grip on power.”

Elsewhere, Ning Jizhe, deputy head of the economic committee of the Chinese People's Political Consultative Conference (CPPCC) and a former vice head of the National Development and Reform Commission (NDRC) flagged concerns of sooner stimulus from China and put a floor under the Gold Price. “China needs to step up measures as soon as possible to bolster a faltering post-COVID recovery in the world's second-largest economy,” said China’s Ning Jizhe per Reuters.

Against this backdrop, Wall Street benchmarks drop and the US Treasury bond yields grind higher, which in turn put a floor under the US Dollar and exert downside pressure on the Gold Price.

However, this week’s central bankers’ speeches at the ECB Forum and the US Core Personal Consumption and Expenditure (PCE) data, the Fed’s preferred inflation gauge, will be crucial to watch for clear directions of the Gold Price.

Gold Price technical analysis

Gold Price approach a one-month-old previous support line as the Relative Strength Index (RSI) line, placed at 14, recovers from the overbought territory. Adding strength to the XAU/USD’s corrective bounce is the looming bull cross on the Moving Average Convergence and Divergence (MACD) indicator.

With this, the XAU/USD is likely to extend the latest rebound provided it manages to cross the immediate support-turned-resistance around $1,925. Following that, a run-up toward the $1,940 hurdle can’t be ruled out.

However, a convergence of the 200-bar Exponential Moving Average (EMA) and the monthly descending resistance line, close to $1,958 by the press time, appears a tough nut to crack for the Gold Price.

On the contrary, failure to cross the $1,925 hurdle can quickly drag the Gold Price towards the latest trough of around $1,910. Following that, the $1,900 round figure will act as the last defense of the XAU/USD buyers.

Gold Price: Four-hour chart

Trend: Limited recovery expected