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The Japanese Yen fell on speculations that the BoJ’s next Governor would be Deputy Governor Masayoshi Amamiya who is all in on maintaining the ultra-loose policy. The dollar maintained its rebound after Friday’s upbeat jobs data and buoyed by risk off sentiment on rising balloon tensions. The tech company DELL is said to slash about 5% of its global workforce. Investors await the RBA meeting scheduled for early Tuesday. A North Korean balloon was spotted over South Korea though it was for a short period.
AUDJPY gained +0.55% as the AUD strengthened ahead of the RBA meeting. The Reserve Bank of Australia is expected to hike key rates by 25 basis points on Tuesday. The Japanese Yen weakened on speculation that Masayoshi Amamiya might be the next Bank of Japan Governor, who supports the ultra-loose monetary policy. Early Monday, retail sales month-on-month came in at -3.9% as anticipated and rose -0.2% in the 4th quarter. Later, the Australian AIG Manufacturing index will be due. The pair fell after a rejection at the 91.60 resistance and may be challenged by 90.00 low on the slide.
GBPCAD rose +0.22% ahead of Canada’s Ivey PMI data. The UK construction Purchasing Managers Index dropped to 48.4, its weakest since May 2020 against a survey of 49.6. This however did not weigh on the sterling against the CAD. The pair got capped by 1.6200 and may retest 1.6000 on the slide if 1.6100 low fails to hold. However, an extended rally may give bulls 1.6300.
EURUSD tanked -0.22% as the dollar extends its rally following Friday`s heated jobs data. The German factory orders rose 3.2% against an anticipated 2.0% in December month-on-month. Eurozone retail sales slumped more than anticipated at -2.7% vs -2.5% monthly. Risk off mood on the day continues to weigh on the pair. Down from 1.0800 the pair is currently faced with a low at 1.0720 and 1.0600.
European stocks dipped on Monday as geopolitics heated up and possible further rate hikes loomed. The UK100 tanked -0.88% after failing to breach 7900 psychological resistance. Sellers may need to move below 7700 for a sustained selling momentum. The CAC40 was down -1.06% from the 7200 high. Further down, bears may reclaim 7000 psychological support. The German40 lost -0.68% trading between 15400 intraday resistance and 15200 immediate low.
US stock futures follow through European shares as rate jitters weigh sentiment. US500 futures were down -0.81% falling towards 4070 resistance-turned-support. The US30 futures dropped -0.60% capped by 33900 and sliding towards 33500 lows. US100 futures fell -1.05% as bears may seek 12200 in the near term.
Crude oil prices rose steadily in European trading nursing Friday`s wounds after a strong dollar was sparked by higher than anticipated NFP reading which may cause the Fed to continue on the tightening path. International Energy Agency Executive Director Fatih Birol said depending on how strong China’s recovery is, the OPEC+ would have to revise their output cut. Brent crude rose +0.79% faced with a high at $84.00 and a low at $74.00. USWTI rose +0.70% currently trading between $73.20-$74.00 per barrel.
