Market Overview: October 21, 2024
Today’s focus is on producer prices from Germany, followed by speeches from the Federal Reserve, and trade balance data from New Zealand later in the day.
Key Data Points
- Germany’s Producer Price Index (PPI) for September showed a decline of -0.5% on a month-on-month basis, which is below the consensus of a 0.2% increase. This signals weakening producer prices, suggesting reduced inflationary pressure in Germany.
- The year-on-year PPI fell by -1.4%, indicating further deflationary trends compared to the previous year’s -0.8%. Lower producer prices could indicate slowing industrial demand in Europe’s largest economy.
Energy Movements:
- Crude Oil: Prices have edged up 0.64% to $69.66 per barrel, recovering slightly after last week’s losses. However, crude remains down 5.72% over the past week due to global demand concerns.
- Brent Oil: Brent prices increased by 0.59%, trading at $73.49 per barrel, following similar recovery trends in the crude oil market.
- Natural Gas: Natural gas prices have risen by 0.41%, now at $2.27 per MMBtu. Despite today’s gain, natural gas remains down 9.29% for the week.
Currency Movements
- EUR/USD: The euro has softened against the dollar, trading at 1.08552, down 0.11%. This decline is in line with weaker European producer price data and marks a 0.50% loss over the past week. Ongoing concerns about inflation trends in the Eurozone continue to weigh on the euro.
- GBP/USD: The British pound is also down, trading at 1.30272, a 0.15% decrease for the day. Over the week, the pound has lost 0.31%, reflecting a cooling in sentiment as market participants await further clarity on the UK’s economic trajectory.
- AUD/USD: The Australian dollar is down 0.22% today, trading at 0.66913. With a weekly loss of 0.48%, the Aussie continues to be pressured by commodity price fluctuations and concerns about China’s economic health, which remains a key driver for Australia’s export market.
- NZD/USD: The New Zealand dollar is trading at 0.60613, down 0.16% for the day. The Kiwi has struggled this month, with a 3.26% decline as trade data and economic outlook concerns drag the currency lower.
- USD/JPY: The Japanese yen is weaker against the dollar, trading at 149.705, up 0.13% for the day. The dollar continues to benefit from its safe-haven appeal, and the yen remains under pressure despite the recent dip in U.S. Treasury yields.
- USD/CNY: The Chinese yuan is down, with the pair trading at 7.12663, marking a 0.14% rise in favor of the U.S. dollar. The yuan has lost ground against the dollar for several weeks, reflecting concerns over China’s slowing economic growth and ongoing trade tensions.
Metals Market:
- Gold: The price of gold continues to climb, up 0.33% to $2,730.28 per ounce as investors seek safe-haven assets amid economic uncertainty.
- Silver: Silver is seeing a stronger increase, up 1.19% to $34.105 per ounce, reflecting solid demand.
Gold price by GoldBroker.com
Things to Keep an Eye on
- Fed Speeches: The market will be closely watching speeches from several Federal Reserve members today, including Logan, Kashkari, Schmid, and Daly. Any comments regarding the U.S. economic outlook or potential future interest rate decisions could impact the U.S. dollar and broader financial markets.
- New Zealand Trade Balance: Later tonight, New Zealand will release its September trade balance data, with forecasts expecting exports around $4.97B and imports at $7.17B. The trade deficit is expected to widen, potentially putting further pressure on the New Zealand dollar.
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