Weekly economic & financial commentary

Wells Fargo Research Team Wells Fargo

Summary

United States: Ahead of the December FOMC: Latest Data Still Supportive of a Cut

As Powell heads into one of his four remaining meetings as Fed Chair, strength in services and lingering consumer resilience contrast with manufacturing weakness, reinforcing expectations for a December rate cut.
Next week: JOLTS (Tue.), ECI (Wed.), FOMC Meeting (Wed.)

International: Global Crosswinds: Sticky Prices and Softer Signals

Eurozone inflation rose more than expected in November, reinforcing the case for the European Central Bank to keep rates on hold. Australia’s Q3 GDP came in below consensus with underlying details showing modest resilience. And in emerging markets, the Reserve Bank of India cut its policy rate and signaled a dovish bias while maintaining a neutral stance.
Next week: Japan Labor Cash Earnings (Mon.), Bank of Canada Policy Rate (Wed.)

Topic of the Week: A Split Committee and Steady Dots

The FOMC heads into its December meeting with a rare degree of internal division. Regional presidents—particularly those with a vote—have signaled greater skepticism toward further easing, setting the stage for opposition in both directions of the policy decision, though the more dovish governors are likely to provide the critical mass of support needed for another 25 bps rate cut.

Download the Full Report!

Author

Wells Fargo Research Team

Wells Fargo

EUR/USD turns negative around 1.1600

EUR/USD is once again under selling pressure, sliding back towards the key 1.1600 support area amid a renewed upswing in the US dollar. The greenback has gathered further momentum after President Trump voiced praise for Kevin Hassett in connection with the Fed chair role.

GBP/USD trims gains, back below 1.33400

The current rebound in the Greenback prompts GBP/USD to surrender a big chunk of its earlier gains and slip back below the key 1.3400 mark on Friday. The marked bounce in the US Dollar followed the markets’ reaction to the likelihood that K. Hasset could become the next Fed Chief.

Gold weakens below $4,600 on USD rebound

Gold adds to Thursday’s small decline and breaks below the $4,600 mark per troy ounce at the end of the week. The precious metal’s corrective move comes on the back of easing geopolitical tensions and the late improvement in the Greenback.

Crypto Today: Bitcoin, Ethereum, XRP hold support amid waning retail demand

Bitcoin slips but holds above $95,000, weighed down by declining retail demand. Ethereum trades narrowly between the 100-day EMA support and the 200-day EMA resistance. XRP edges lower for the third consecutive day, driven by a persistently weakening derivatives market.

Week ahead – US PCE and Davos in focus for Dollar traders – BoJ meets

US PCE, PMIs and remarks from Davos could impact Fed cut bets. BoJ to stand pat; focus to fall on guidance after election reports. UK CPI and retail sales data may confirm bets of more BoE cuts.

Dash Price Forecast: DASH defies headwinds, paces toward $100

Dash extends its rally, reaching an intraday high of $96.85 despite the broader crypto market correcting. Retail interest in DASH explodes as futures Open Interest soars to $165 million.