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Markets Update: APAC equities traded mixed on Wednesday, with the region cautious ahead of today's key US inflation data.
Today's important market events:
[GBP] BoE Gov Bailey Speaks - 10:00 CEST
[USD] CPI (MoM/YoY - Jun) - 14:30 CEST
[CAD] BoC Interest Rate Decision - 16:00 CEST
[USD] Crude Oil Inventories - 16:30 CEST
Global Markets Roundup: 12 Jul 2023
European equity futures are pointing to a higher open, with the Euro Stoxx 50 up 0.4%. The US dollar index (DXY) slipped to a fresh two-month low, as USD/JPY moved back below 140 and the People's Bank of China (PBoC) set a firmer CNY fix. The New Zealand dollar (NZD) was stronger after the Reserve Bank of New Zealand (RBNZ) kept the official cash rate (OCR) unchanged at 5.50%.
The RBNZ said that the OCR will need to remain at a restrictive level for the foreseeable future. This was in line with expectations, but the decision was seen as a sign that the RBNZ is committed to fighting inflation.
The ASX 200 leading the gains in APAC region. The Nikkei 225 underperformed, while the Hang Seng and Shanghai Composite saw mixed fortunes. US equity futures were rangebound near yesterday's peak.
In the FX market, the dollar index (DXY) remained pressured and declined to a fresh 2-month low. The euro (EUR/USD) benefitted from the subdued dollar and strengthened its footing on the 1.1000 handle. The pound (GBP/USD) extended further north of the 1.2900 level. The Japanese yen (USD/JPY) continued its recent pullback to below the psychological 140.00 level.
In fixed income, 10-year US Treasury futures were contained amid a non-committal mood heading into the US inflation data. Bund futures lacked firm direction overnight with price action stuck around the 131.00 level. 10-year Japanese government bond (JGB) futures were pressured.
In commodities, crude futures were rangebound as bearish private inventory data stalled the recent upward momentum. The EIA STEO (July) stated 2023 world oil demand growth forecast was raised by 170k BPD to a 1.76mln BPD Y/Y increase, while the 2024 forecast was cut by 60k BPD to a 1.64mln BPD Y/Y increase.
Iraq and Iran have agreed to a new payment mechanism for gas exports, with Iraq to trade crude oil for Iranian gas. This agreement comes after a recent stoppage in gas exports from Iran to Iraq due to delayed payments. The new mechanism is seen as a way to circumvent US sanctions on Iran, and it is expected to boost gas supplies to Iraq.
Gold prices benefited from the weaker US dollar, but gains were capped ahead of US inflation data. Copper prices continued to claw back losses from the previous day, as the dollar weakened.
Looking ahead, key events include the US CPI, the Bank of Canada (BoC) policy announcement, speeches by several Federal Reserve (Fed) officials, and supply reports from Germany, the UK, and the US.
General news - Information source from multiple newswires.
The article and the data is for general information use only, not advice!
The Trade Academy Team