Hawkish policy outlooks from Bullard and Mester (50 bps boosts from both), on top of more strong economic reports, added to the selling pressures in Treasuries and on Stocks. PPI and jobless claims, on top of the hot CPI, nonfarm payrolls, and retail sales reports added to the bearish impact but boosted the safety of USD along with pricing in of rate hikes.
24% of global fund managers now expect a recession, down from 77% in November, according to a recent survey by BofA Global Research.
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- USD Index spiked to 104.40.
- GBP – This morning, retail sales volumes unexpectedly rose by 0.5% in monthly terms in January but the overall picture remained one of weak demand from inflation-hit consumers. GBPUSD – at 200-DMA, i.e. 1.1936 – Next Support: 1.1840.
- Stocks – The US markets dipped in the last trading hour of US session. US100 (-1.78%), US500 (-1.38%), US30 (-1.26% at close). Tesla (-5.69%) laid off 4% of NY employees & recalled 362,000 US vehicles over Full Self-Driving software. NatWest (+4.97% afterhours, -9% in London currently) profit jumps by a third on revenue boost from rate rises. Allianz (currently +0.55%) swung to a fourth-quarter net profit, marking a return to the black. Mercedes (currently +0.33%) warned of lower earnings this year due to economic uncertainty.
- Commodities – USOil – Futures dropped to $77.26, Wednesday’s floor, as a hawkish FED could hit fuel demand even as crude stockpiles grow. It held 34-week below 20-WMA.
- Gold – drifts below S1 at $1822 today. Next support at $1818 and $1809.
- Cryptocurrencies – BTC – Plummeted to $23,317 on USD strength. Reuters Exclusive: Crypto giant Binance moved $400 million from US partner to firm managed by CEO Zhao.
Today – Speeches from Fed’s Barkin and Bowman. EARNINGS – Deere & Company.
Biggest FX Mover @ (07:30 GMT) NZDUSD (-0.91%). Dip to 0.6195 now. MAs extend lower, MACD histogram & signal line negative and declining, RSI 22.80, H1 ATR 0.00117, Daily ATR 0.0080.
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Andria Pichidi
Market Analyst
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