The dollar got helped by the cautious mood on the day as traders await key data from the US. Higher than anticipated GDP data from the US failed to rule out expectations of a softer Fed landing. Japan tightened sanctions against Russia after fresh attacks on Ukraine adding goods to an export ban list and freezing the assets of Russian officials and entities.
AUDJPY was trading -0.40% lower after the release of key economic data from both countries. The Tokyo Core Consumer Price Index rose more than expected in January to 4.3% vs the 4.2% anticipated. In Australia, producer prices dipped in the final quarter of 2022 to 5.8% from 6.3% survey [YoY] and 0.7% vs 1.7% expected [MoM]. The risk-sensitive AUD faces pressure on the cautious mood on the day. The pair`s upside momentum is currently capped at 92.50 while bears may aim for 92.00 psychological support and 91.50.
GBPUSD edged -0.32% lower ahead of inflation data from the US. Core Personal Consumption Expenditures data is anticipated to have risen to 0.3% in December from 0.2% in the previous month. This comes after the release of the US GDP data on Thursday which rose 2.9% vs 2.6% surveyed. There is not much on Britain’s economic file as the odds of the BoE nearing a pivot grows stronger. For the bulls to keep reigning, a break above 1.2450 would be necessary. However, a retest of 1.2350 and 1.2250 lows may be seen in the near term.
EURZAR pared early European trading gains and is currently down -0.14% from 18.78820 intraday resistance. The South African Reserve Bank failed to deliver an interest rate hike on Thursday and settled at 25 bps against the anticipated 50 bps. Poor risk appetite on the day weighed on the Euro although downside pressure may be limited by the hawkish ECB. Further bearish moves may be challenged by the 18.5582 and 18.5322 lows.
European stocks edged lower to the end of the week. The German 40 lost -0.40% from the 15188 intraday high and may be challenged by the 14900 low. Further up, bulls may need to reach the 15200 resistance. The UK100 was down -0.18% as it struggled for traction slightly a few ticks above 7750. France40 fell -0.11% below the 7100 psychological level. The CAC40 may seek to revisit 6950 before extending a move higher.
US stock futures were quite mixed ahead of the highly awaited PCE inflation data from the US. The US500 futures were down -0.13% trading in a range between 4042 and 4055. Further up, bulls are capped by 4075 and sellers limited by 4000. US 30 futures were flat at +0.03%, a touch away from the 34000 psychological mark. A move higher may give 34400. US100 futures tanked -0.12% after poking above 12000. Upside traction is capped by 12200.
The benchmark US 10-year treasury bond yields soared by +1.26% as it strengthened along with the greenback ahead of key US data. The yield rose from 3.50% and may be capped by 3.600%.