Last week, a wave of risk aversion surprised traders and lowered benchmark stock indexes and sentiment-sensitive currencies. Investors weighed Covid’s concerns and China’s transmission risk against the slowdown in global economic recovery.Growth-sensitive tech stocks cost money Wall street, With Nasdaq The 100 index fell 0.69% that week.
China’s real estate giant Evergrande is under severe stress, threatening China’s broader real estate and financial markets. Chinese companies have less than $ 300 billion in debt, making them the most debt-rich real estate companies in the world. The credit market is in turmoil over the risk of transmission as a major bank has stopped issuing loans to Chinese home developers. China’s retail sales in August were lower than expected, contributing to emotional headwinds.
Safe shelter U.S. dollar Inflows were seen throughout the week as traders digested vulnerable global risk factors and the US dollar DXY index rose 0.64%. Risk-sensitive currencies Australian dollar When New Zealand dollar.. In the midst of printing strong domestic data, Treasury yields have risen. US retail sales and consumer confidence indicators have risen since July, showing some relative strength in the economy. gold It fell for two weeks due to stronger greenbacks and concerns over the Fed’s tightening.
This week brings a heavy economic docket with some attention-grabbing central bank decisions. The Bank of Japan (BoJ), the Federal Reserve Board of Governors, and the Bank of England (BOE) announce interest rate decisions. The Bank of Japan may downgrade its economic outlook while maintaining negative interest rates. Some expect the Federal Reserve to elaborate on its balance sheet tapering plan later in the week. Finally, the Bank of England may leave Covid stimulus in place as the economy slows.
Weekly performance of the US dollar against currencies and gold
This week, a meeting of central banks in the United States, Japan and the United Kingdom will be at the heart of traders, but it is wise not to ignore the German federal elections next Sunday.
The Australian dollar remains hostage to commodity market turmoil as low interest rates cannot attract buyers. Yields are high, AUD / USD Around that?
Wednesday’s Fed gets a lot of attention as investors are considering the possibility of a tapered announcement
Aside from China’s growing uncertainty about Evergrande’s default risk, two central bank decisions will dominate next week’s market theme.
The US dollar (via the DXY index) is on the rise as markets expect more tapered discussions at the Fed’s meeting in September.
Federal Reserve interest rate decisions can influence the short-term outlook for gold prices, as central banks appear to be on track to curtail financial support.
NS JPY Is paying close attention to the Bank of Japan’s future interest rate decisions and CPI figures, but the yen cross may continue to rely on a wide range of market sentiment.
USD / CAD The Federal Reserve Board has been trading in choppy ways looking for catalysts that it might offer next week.
The stock appears to be in the corrective stage, but it could be tested. Levels and lines to watch in the future.
With gold plunging for two weeks and price testing with a key support pivot of more than 9% off August lows, the rally is currently investigating major resistance hurdles.NFP.. Important level in XAU /U.S. dollar Weekly chart.
GBPThe / USD integration may end shortly after July if prices deviate from the symmetric triangle. At this time, there may be a downside following the emergence of desk loss.
The US dollar won a bid to hit its September highs later last week. FOMC Just around the corner, can the bull push another fresh high?
US Dollar, FOMC, GBP / USD, BoE, USD / JPY, Bank of Japan, AUD / USD, China Debt Crisis
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