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Daily Market Commentary
Markets closed out a relatively negative week flat, ahead of the US long weekend. Markets are looking for direction after closing out 2023 on a positive note, with equities reaching for record highs, with bond yields crashing, in celebration of the Fed's telegraphed rate cuts planned for 2024. The Fed has all but declared victory over inflation and is ready to cut rates and release the pressure on the Banks' collective balance sheets. The problem is inflation. The war in Gaza has spread, to include the Red Sea, and a Yemeni blockade on shipping. This has led to supply chain problems and pushed the prices of goods and energy upwards, once again triggering inflationary pressures. An escalation of the Middle East war and the extension of the war in the Ukraine, can only aggravate the situation. The US Dollar remained steady, with the EUR trading around 1.0950, while the GBP regains1.2750.
The reserve was steady, and the commodity currencies remain subdued, with the AUD trading below 0.6700, while the NZD struggles to hold above 0.6200. This coming week will be focused on growth and inflation, while Geo-Political events threaten to dominate markets.
Weekly Market Calendar
15/1 US MLK Holiday, Australia Job Ads, PBoC Announcement, German Wholesale Prices, Sweden CPI, German GDP, EU Trade/Industrial Production
16/1 NZ Business Confidence, Australia Consumer Confidence, Japan PPI, Australia Inflation Gauge, Australia Building Permits, German CPI, UK Employment, Italy CPI, EU Employment, German/EU ZEW Economic Sentiment, Canada CPI, Empire State Manufacturing Index
17/1 NZ Dairy Prices, NZ Credit Card Spending, Japan Tankan Report, China House Prices, China GDP/Industrial Production/Employment, UK CPI/PPI, EU CPI, US Weekly Mortgage Applications, US Retail Sales
18/1 US Industrial/Manufacturing Production, NAHB House Market Index, Fed's Beige Book, Australia Employment, Japan Industrial Production, EU Current Account, ECB Accounts, US Building Permits/Housing Starts/Weekly Jobless Claims, Philly Fed Manufacturing Index
19/1 NZ Business PMI, Japan CPI, German PPI, UK Retail Sales, University of Michigan Economic Sentiment
PLEASE NOTE THE VIEWS EXPRESSED IN THIS COMMENTARY ARE THOSE OF THE AUTHOR AND NOT COLLINSON & CO
Paul Bettany I Collinson Forex Limited Collinson & Co. Private Banking
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