|

Dollar resurgence on the cards as US data outperforms Europe

US manufacturing and jobs data shows improvement, with outperformance over Europe and the potential for a risk-off move helping to lift the dollar.

Philly Fed manufacturing survey lifts dollar to three-week high

“The dollar index has broken to a three-week high today, with fears of a potential topping out in equities tallying up with signs of US outperformance over Europe. First inflation, then retail sales, and now we have seen improvement in the jobless claims and the Philly Fed manufacturing survey for the US. While a recession is widely anticipated, there are signs that European nations will suffer greater consequences as energy prices signal the potential for a greater contraction if the breakdown in relations with Russia remains in place. Unfortunately, European contraction looks set to come alongside sharp increases in rates, with the ECB’s Schnabel coming out in favour of another hefty interest rate rise despite recession risks.”

Energy stocks on the rise, as crude prices see respite from selling pressure

“Oil & gas stocks have enjoyed a welcome boost today, following a period of weakness in crude prices that took Brent into a fresh five-month low. Yesterday’s surprise 7.1 million barrel contraction in US inventories helped undermine the bearish breakdown taking shape for crude, lifting hopes that a tightening supply-demand dynamic will push prices upwards once again. However, with an economic slowdown seemingly a foregone conclusion for many of the world’s top crude consumers, it looks likely that this rebound will soon be sold into on the premise of lower demand.” 

Author

Joshua Mahony MSTA

Joshua Mahony MSTA

Scope Markets

Joshua Mahony is Chief Markets Analyst at Scope Markets. Joshua has a particular focus on macro-economics and technical analysis, built up over his 11 years of experience as a market analyst across three brokers.

More from Joshua Mahony MSTA
Share:

Editor's Picks

AUD/USD holds firm near 0.7000 after Chinese inflation, trade data

AUD/USD stays firm near 0.7000 in Wednesday’s Asian session, picking up some bids after China's mixed inflation and upbeat trade data. CPI rose less than expected in September, while PPI inflation picked up. Meanwhile, the Chinese trade surplus unexpectedly widened in September. The pair remains underpinned by a broadly subdued US Dollar, despite the Middle East escalation, as focus remains on US CPI data.

USD/JPY consolidates near 158.50; looks to US CPI for fresh impetus

USD/JPY stays range-bound near 158.50 in the Asian session on Wednesday, with looming intervention risks supporting the Japanese Yen and capping upside amid a softer US Dollar. However, geopolitical uncertainties act as a tailwind for the safe-haven USD and the pair. Traders also seem hesitant ahead of the release of the latest US inflation figures.

Gold drifts lower with US CPI, Fed speakers in focus

Gold extends losses on Wednesday, despite the lower US Treasury yields, with investors looking from the sidelines ahead of the release of September’s US Consumer Price Index report and speeches from Federal Reserve officials due later in the day. The XAU/USD pair has retreated below the $4,150 level after rejection at the $4,200 area on Monday, with technical indicators showing building bearish momentum.

Bitcoin eyes $85,000; ETH holds support, XRP stabilizes
Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) show signs of recovery on Wednesday as buyers try to regain control after their recent market weakness. BTC extends its rebound toward the $85,000 resistance, while ETH and XRP find support around key levels.
US CPI data expected to rise in September as markets reassess Fed rate outlook

The US Bureau of Labor Statistics will publish the September Consumer Price Index (CPI) data on Wednesday. The report is expected to show a further increase in headline prices and a small uptick in annual core inflation. Any divergence from analysts’ estimates could influence the Federal Reserve’s policy outlook and impact the US Dollar’s valuation.

Has Bitcoin really escaped the macro forces it was built to fight?
Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?