Fed, BoE and BoJ in focus this week - Rabobank

Sandeep Kanihama FXStreet Contributor

According to analysts at Rabobank, the Fed, the BoE and the BoJ are likely to be the key events this week as they all will hold their monetary policy meetings in the last proper week of trading in a volatile 2018.

Key Quotes

“With the December rate hike of 25bp fully priced in, the market’s attention has shifted to the Fed’s policy path in 2019. The new FOMC projections are likely to reflect the deterioration in economic data and market sentiment that didn’t go unnoticed by various Fed speakers. If the FOMC participants will remove only one of the three hikes for 2019, that would still leave the dot plot with one more hike than markets are currently expecting for next year. Philip anticipates just one hike next year in March. He also expects expect the yield curve to invert after that hike, signalling a recession in 2020, and ending the hiking cycle altogether.”

“As for Brexit, PM May is under growing pressure from with her own cabinet to consider all available options, including a second referendum, to solve the political impasse caused by lack of support in parliament for her Withdrawal Agreement accompanied by persistent reluctance from other European leaders to offer much stronger assurances regarding the Irish border backstop. That said, May is expected to say that a second vote would be a catastrophic breach of trust. A firm rejection by May to even contemplate another referendum would leave sterling vulnerable amid rising market concerns that the UK is on the path that leads to a hard Brexit.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

EUR/USD climbs to daily highs, focus on 1.1650

EUR/USD now picks up extra pace, climbing past the 1.1640 level, or daily highs, as the US Dollar continues to lose momentum. The move follows fresh tariff threats from President Trump against eight European countries opposing his proposal to take Greenland. With US stock and bond markets closed for Martin Luther King Jr. Day, trading conditions are likely to remain thin.

GBP/USD advances to two-day tops near 1.3420

GBP/USD found its footing after a soft start to the week, edging modestly above 1.3400 the figure on Monday. The British Pound gathers steam on the back of a weaker Greenback, as markets continue to evaluate President Trump’s latest tariff threats against Europe over Greenland.

Gold: Is there a ceiling for XAU/USD?

Gold drew strong buying interest at the start of the week, surging to a fresh record high near $4,700 per troy ounce. Markets turned more cautious after President Trump threatened tariffs on eight European countries opposing his plan to acquire Greenland, a shift that helped underpin the yellow metal.

Dogecoin, Shiba Inu, Pepe in a freefall, echoing Bitcoin’s drop

Meme coins, such as Dogecoin, Shiba Inu, and Pepe, extend the decline from last week, with a roughly 3% drop on Monday. The meme coins trade below the crucial moving averages, aiming for the immediate support to potentially reset the momentum.

When tariffs become ammunition and capital becomes the battlefield

Markets opened the week like a risk engine hitting a pothole at speed. Equities stepped back, gold vaulted to fresh highs, Treasuries caught a bid, and the dollar, outside of havens, took on a soft bid. This was not a data-driven wobble or a valuation purge.