Weekly Forex Analysis By zForex

[zForex]

In the United States, the focus will be on the Federal Open Market Committee (FOMC) meeting, where it is anticipated that borrowing costs will remain at their current levels. Market participants will pay close attention to Chair Powell's comments for hints about potential rate cuts expected throughout the year, especially given ongoing inflationary pressures. The economic calendar is also packed, with the non-farm payrolls anticipated to show a rise of 210K in April, down from 303K in March. The unemployment rate is projected to hold steady at 3.8%, with monthly wage growth expected at 0.3%. Other significant data includes April's ISM PMI surveys, JOLTs job openings, foreign trade, the first-quarter employment cost index, productivity reports, Case-Shiller home prices, ADP Employment Change, factory orders, and regional indexes like the Dallas Fed Manufacturing Index and Chicago PMI. Additionally, the first-quarter earnings season will see updates from major corporations such as Apple, Amazon, 3M, Coca-Cola, McDonald's, Starbucks, AMD, PayPal, ADP, Estee Lauder, Mastercard, Pfizer, Amgen, Moderna, and Novo Nordisk.

In Canada, attention will be on GDP and trade data.

Europe's economic landscape will also be bustling with activity. The Eurozone is expected to report a 0.2% expansion in GDP for the first quarter after a stagnant end to 2023. Inflation is likely to stay at 2.4%, near its lowest in two years. Key releases include consumer price inflation, unemployment for March across Germany, France, Spain, and Italy, and various PMI figures. Other data to watch include the Eurozone business survey, Germany's retail sales, the UK's monetary indicators, and inflation rates from Switzerland, Turkey, and Poland.

In Asia, China's PMIs are expected to indicate a slight slowdown, which may temper optimism about the economy's momentum. Japan will release data on consumer confidence, unemployment, retail sales, industrial production, and housing starts for March, with the Bank of Japan's meeting minutes also due for release. Australia will focus on the trade balance, retail sales, housing, credit data, and the Ai Group industry gauge for April.

Overall, investors globally will have several data and earnings reports to observe, influencing market sentiments and investment decisions.

 

[zForex]

Weekly Analysis (6May – 10May)

This coming week promises to be quite interesting as we get to see how various central banks around the world, excluding the Fed, ECB, or BoJ, decide to handle their policies. Some may decide to cut rates, some may decide to hold rates while sounding patient, some may decide to hold steady and hint at possible future cuts, and there's even one facing expectations to start hiking again! While a lot of attention has been focused on the Federal Reserve lately, there's a chance that we'll see even greater differences in approach between central banks around the world. It's a bit like gambling for these banks as they navigate uncertain times, trying to decide whether to hold steady, change, or take extreme measures. The ones that make the wise choices will stand out from the ones that make the mistakes.

The global economic calendar for the week ahead isn't as busy as usual. However, there are still some important events to watch out for. In the US, crude oil inventories and the 10-Year Note auction will be closely monitored. On Thursday, weekly jobless claims data will be monitored in the US. On Friday, in the US, the preliminary May data for the Michigan Consumer Sentiment Index is expected to show a monthly decrease of 1 point, settling at 76.2.

Attention will turn to the health of the UK economy following the Bank of England's decision at the end of the week. In addition, inflation reports will be out from various countries, which could have an impact on regional markets.

 

[zForex]

Dollar Rises on Rate Cut Bets, Gold Gains Nearly 1% (16-20 December)​

The dollar index rose above 107, gaining 1% for the week, as markets priced in a 25-basis point Fed rate cut, with 2025 remaining uncertain.

The euro weakened after the ECB’s 25-basis point cut, while the pound hit a six-month low on weak growth data. Markets expect three Bank of England rate cuts in 2024.

Gold rose nearly 1% on mixed U.S. inflation data and jobless claims, with a 93% chance of a December Fed rate cut. Silver fell below $31 per ounce, pressured by weak Chinese demand. Treasury yields rose, with the ten-year at 4.38% and two-year at 4.22%.

Japan GDP (QoQ) (Q3)​

Japan's GDP grew 0.3% in Q3 2024, beating the 0.2% forecast, after a revised 0.5% rise in Q2. Business investment fell 0.1%, less than expected, and net trade dragged GDP by 0.2 points, better than the 0.4-point forecast. Exports grew 1.1% and imports 1.8%, both slower than in Q2. Private consumption rose 0.7%, supported by wages, while government spending increased just 0.1%.

RBA Interest Rate Decision (Dec)​

The RBA kept its cash rate at 4.35% for the ninth consecutive meeting, as expected. While headline inflation has eased, underlying inflation remains elevated and is not projected to hit the 2-3% target until 2026. Economic data aligns with forecasts, though household consumption recovery may be slow, impacting growth and the labor market. The rate on Exchange Settlement balances remains at 4.25%.

German CPI (MoM) (Nov)​

Germany's inflation rose to 2.2% in November from 2.0% in October, driven by higher service costs. Energy prices continued to ease inflation but less than before. Month-on-month, consumer prices fell 0.2%.

U.S. CPI​

In November, the CPI-U rose 0.3%, following four months of 0.2% increases, with an annual rise of 2.7%. Shelter rose 0.3%, contributing 40% of the monthly increase. Food prices rose 0.4%, with food at home up 0.5% and food away from home up 0.3%. The energy index rose 0.2% after no change in October. The core index, excluding food and energy, increased 0.3% for the month and 3.3% year-over-year. Energy fell 3.2%, and food rose 2.4% over the past year.

BoC Interest Rate Decision​

The Bank of Canada cut its key rate by 50 basis points in December, totaling a 175-point reduction from a 5% peak. Policymakers signaled no further aggressive cuts, citing 1% Q3 GDP growth below expectations and risks to Q4 growth. Consumer spending exceeded forecasts, and inflation is projected to stay near 2%, though potential US tariffs add uncertainty.

SNB Interest Rate Decision (Q4)​

The SNB cut its key rate by 50 basis points to 0.5%, exceeding expectations of 25 points. This fourth consecutive cut, the largest since 2015, brings rates to their lowest since November 2022. Inflation fell from 1.1% in August to 0.7% in November and is projected to average 1.1% in 2024, 0.3% in 2025, and 0.8% in 2026. GDP growth is forecast at 1% in 2024, rising to 1-1.5% in 2025, but risks include rising unemployment, slower production, and geopolitical uncertainties.

ECB Interest Rate Decision (Dec)​

The ECB cut key interest rates by 25 basis points, citing progress in disinflation and improved policy transmission. Inflation is forecast to average 2.4% in 2024, 2.1% in 2025, and stabilize near 2% by 2026-2027. Core inflation, excluding energy and food, is projected at 2.9% in 2024 and 1.9% by 2026-2027.

Economic growth is expected at 0.7% in 2024, rising to 1.4% in 2026, driven by higher incomes and investment. Tight financing conditions persist but are easing with recent rate cuts. The ECB remains committed to a data-driven approach to maintain its 2% inflation target.

Initial Jobless Claims​

For the week ending December 7, initial jobless claims rose by 17,000 to 242,000, with the prior week revised up to 225,000. The 4-week average increased by 5,750 to 224,250.

For the week ending November 30, the insured unemployment rate held at 1.2%, with insured unemployment rising by 15,000 to 1,886,000. The 4-week average increased by 3,500 to 1,888,000, the highest since November 2021.

PPI (MoM) (Nov)​

The Producer Price Index (PPI) rose 0.4% in November, following increases of 0.3% in October and 0.2% in September. Annually, the unadjusted PPI increased 3.0%, the largest since February 2023's 4.7%.

Nearly 60% of November's increase came from a 0.7% rise in goods, while services rose 0.2%. Excluding food, energy, and trade services, the index edged up 0.1% in November and 3.5% over the year.

UK GDP (MoM) (Oct)​

The UK economy grew 0.1% quarter-on-quarter in Q3 2024, down from 0.5% in Q2 and below the 0.2% forecast. Services rose 0.1%, driven by 0.7% growth in professional activities and 0.6% in trade. Construction grew 0.8%, while production fell 0.2% due to a 2.7% drop in energy supply.

Net trade contributed positively as exports fell 0.2% and imports dropped 1.5%. Household spending rose 0.5%, business investment increased 1.2%, and government consumption grew 0.6%. Year-on-year, the economy grew 1%, up from 0.7% in Q2.

Currencies​

The dollar index rose above 107, gaining 1% for the week, driven by expectations of a 25-basis point Fed rate cut and strong November PPI data. The euro weakened after the ECB opted for a 25-basis point cut, while the pound hit a six-month low on weak growth data. Markets expect three Bank of England rate cuts in 2024.

The yuan ended flat after China’s Central Economic Work Conference signaled expansive fiscal and monetary policies but left investors uncertain. The Australian dollar fell as unemployment dropped to 3.9%, and employment rose by 35,600, reducing the likelihood of a February RBA rate cut to 50%. The RBA held rates at 4.35% but leaned dovish.

The Swiss Franc dropped to 0.89 per USD after a surprise 50-basis point SNB rate cut, the largest in a decade, as inflation fell to 0.7% in November. Swiss GDP growth remained weak in Q3.

Commodities​

Gold rose nearly 1% this week as mixed U.S. inflation data and jobless claims boosted expectations of a December Fed rate cut, with a 93% chance of a 25-basis point cut, per CBOT. Investors await the Fed's December 17-18 meeting and Chair Powell’s insights on 2025 policy. U.S. Import Prices rose slightly, while Export Prices fell in November.

Silver dropped below $31, down from last week's $32 high, pressured by weak Chinese demand despite dovish central bank actions. Concerns include China's yuan devaluation, loosening monetary policy, and solar panel overcapacity, which may limit silver demand.

Equities​

Last week, stock indices showed mixed results. The Nasdaq closed slightly higher, while the S&P fell nearly 1%, and the Dow dropped 1.7%. Nvidia led declines with an 8% drop, followed by Intel (-3%) and Cisco (-2.5%). Google and Tesla gained 10%, while Amazon rose 3%.

 

[zForex]

Weekly Analysis By zForex Research Team (23-27 December 2024)​

Fed Signals, Inflation Data, and Global Trends Reshape Market Dynamics​

The dollar index hit a two-year high of 108.5 on hawkish Fed signals but eased after core PCE prices rose just 0.1% in November, sparking hopes for disinflation.

The euro dropped to $1.0340 on weak Eurozone data, and the pound fell below $1.25 amid rising UK inflation. The yen rebounded slightly after Japan's inflation data fueled hawkish BOJ expectations but stayed pressured by a strong dollar.

Gold fell to around $2,600, weighed down by the Fed's hawkish stance and limited 2025 rate cuts, while silver dropped to $29 on weak industrial demand from China. Both metals remain up for the year on safe-haven demand and central bank purchases.

U.S. Treasury yields rose, with the 10-year yield hitting 4.50%, while the 2-year yield ended at 4.27% after an early-week surge.

S&P Global US Manufacturing PMI​

The US Manufacturing PMI fell to 48.3 in December, marking the sixth consecutive contraction. Output dropped to its lowest since August 2009, excluding the pandemic slump, as new orders continued to decline. Inflationary pressures persisted due to rising raw material costs, while tariff concerns under the Trump administration added to uncertainty.

S&P Global US Services PMI​

The Services PMI climbed to 58.5 in December, the strongest growth since October 2021. New orders rose at their fastest pace since March 2022, and employment grew for the first time since July. Cost growth slowed to its lowest in four and a half years, supported by weaker wage growth. Optimism surged on expectations of a business-friendly environment under the Trump administration.

U.S. Retail Sales (Nov)​

Retail sales grew 0.7% in November, surpassing expectations of 0.5%. Gains were led by motor vehicles (+2.6%) and nonstore retailers (+1.8%), while declines were seen in miscellaneous retail (-3.5%) and food services (-0.4%). Excluding autos, food services, building materials, and gas, sales rose 0.4%, reflecting strong consumer spending during the holiday season.

UK CPI​

UK inflation climbed to 2.6% in November, its highest in eight months, driven by higher recreation and housing costs. Services inflation held steady at 5%, and core CPI rose by 3.5% YoY. Monthly CPI growth slowed to 0.1%, matching forecasts, while core prices were flat.

EU CPI​

Eurozone inflation edged up to 2.2% in November, below preliminary estimates of 2.3%. Energy prices declined at a slower pace (-2%), while service inflation eased to 3.9%. Core inflation remained stable at 2.7%, with the monthly CPI falling by 0.3%.

FED Interest Rate Decision​

The Fed cut rates by 25bps to 4.25%-4.5%, its third cut this year. Projections for 2025 were revised to just 50bps in cuts, down from 100bps. GDP forecasts for 2024 and 2025 were raised, while inflation expectations for core PCE were increased to 2.8% in 2024.

BOJ Interest Rate Decision​

The BoJ kept rates at 0.25%, citing uncertainties over wage growth and global policies. Inflation ranged between 2%-2.5%, with core CPI expected to rise gradually. Despite weak exports, private consumption and business spending supported economic recovery.

BOE Interest Rate Decision​

The BoE maintained its benchmark rate at 4.75%, as inflation and wage growth increased risks of persistent inflation. Three MPC members supported a 25bps rate cut, citing weak demand. The Bank emphasized the need for a gradual approach to easing.

U.S. GDP Growth Rate​

The US economy expanded by 3.1% in Q3, exceeding estimates. Consumer spending rose 3.7%, driven by goods consumption and services. Fixed investment grew by 2.1%, while government spending was revised up to 5.1%.

Initial Jobless Claims​

Jobless claims fell to 220,000 in the first week of December, beating expectations of 230,000. Ongoing claims also declined to 1.874 million. The data alleviated concerns of labor market weakness, aligning with the Fed’s projections.

Core PCE Price Index​

Core PCE prices rose 0.1% in November, marking the smallest increase since May. Year-over-year, core PCE grew 2.8%, while overall PCE inflation stood at 2.4%. Disposable personal income and consumption rose 0.2% and 0.3%, respectively.

Currencies​

The dollar index reached a two-year high of 108.5 but eased slightly on disinflation hopes. Core PCE prices increased by 0.1%, raising expectations for more rate cuts in 2025. The euro fell to $1.0340, pressured by weak Eurozone data and political instability. The pound dipped below $1.25 as UK inflation rose to 2.6%, while the yen dropped to a five-month low after the BoJ left rates unchanged. The Australian dollar hit its lowest since October 2022 amid expectations of RBA rate cuts.

Commodities​

Gold fell to $2,600 per ounce this week, weighed down by the Fed’s hawkish stance and weaker physical demand in India. Silver dropped to $29 per ounce, pressured by weak industrial demand and concerns over China’s looser monetary policy.

Equities​

U.S. indices mostly closed the week lower. The S&P 500 finished the week down by approximately 1.5%, while the Dow Jones also dropped by 1.5%, marking its third consecutive week of losses. The Nasdaq ended the week with a modest gain.

 

[zForex]

Weekly Analysis By zForex Research Team (30 Dec - 03 Jan)​

Dollar Index Rises as Rate Cut Expectations Drop​

The Dollar Index rose slightly as 2025 rate cut expectations dropped to 35 basis points. EUR/USD fell on Lagarde's dovish remarks, while GBP/USD declined due to BoE rate cut votes and weak Q3 GDP. The yen weakened as mixed data and BoJ caution on rate hikes outweighed higher Tokyo inflation.

Gold traded steadily amid light data and geopolitical calm, pressured by the Fed's hawkish stance and limited 2025 rate cut outlook. Silver struggled due to China's economic slowdown, solar sector overcapacity, and yuan devaluation risks.

Fixed Income: Last week, 2-year U.S. Treasury yields remained steady at 4.32%, while 10-year yields increased slightly to 4.58%.

Initial Jobless Claims​

US initial jobless claims fell by 1,000 to 219,000 in mid-December, below expectations of 224,000, signaling a tight labor market. However, outstanding unemployment claims rose to 1.91 million, the highest in three years, indicating longer job search periods. The four-week moving average increased slightly to 226,000, with notable state-level increases in New Jersey and Tennessee.

U.K. GDP​

The British economy stagnated in Q3 2024, with GDP growth revised to 0% from an initial 0.1%. Services showed no growth, while production fell 0.4%, driven by declines in energy supply. Construction grew by 0.7%, and business investment rose by 1.9%, but lower government spending and trade revisions contributed to overall weakness.

Durable Goods Orders (Nov)​

US durable goods orders fell 1.1% in November to $285.1 billion, worse than the expected 0.4% drop. Transportation equipment led the decline, down 2.9%, while non-defense capital goods excluding aircraft, a business investment measure, rose 0.7%, the largest gain since August 2023.

New Home Sales (Nov)​

US new home sales rose 5.9% in November to an annual rate of 664,000, beating expectations. Gains were led by the South and Midwest, while sales fell in the West and Northeast. The median home price stood at $402,600, with an inventory equivalent to 8.9 months of supply.

Currencies​

The Dollar Index edged higher, supported by lowered expectations for 2025 rate cuts and US policy shifts under Trump. EUR/USD weakened after Lagarde’s dovish comments on service inflation. GBP/USD declined due to BoE rate cut votes and weak Q3 GDP. The yen fell on mixed BoJ signals, despite higher Tokyo inflation. USD/CAD rose as Canada’s GDP revision fueled speculation of further rate cuts. The yuan weakened following a large liquidity withdrawal by the People's Bank of China amid a shift to a “moderately loose” monetary policy.

Commodities​

Gold traded steadily, pressured by the Fed's hawkish stance and limited 2025 rate cut expectations. Silver struggled due to China’s economic slowdown, solar sector issues, and yuan devaluation risks.

Equities​

US stocks rebounded this week, with the Nasdaq up 2%, the S&P 500 gaining 1.5%, and the Dow Jones rising 1.1%. Apple and Nvidia led the rally, while Meta and Microsoft lagged with a 1% decline.

Post automatically merged: Jan 6, 2025

Weekly Analysis By zForex Research Team (06 - 10 Jan)​

Dollar Hits 2022 Highs as Growth Outlook Lifts Markets​

The dollar index rose to 109.4, its highest since October 2022, driven by strong U.S. growth expectations, elevated rates, and Trump’s pro-growth policies. The euro fell to $1.0220, weakened by Europe’s weak outlook and a dovish ECB, while the pound dropped on UK economic stagnation and BoE rate cut signals.

Gold ended the week positively, supported by strong Chinese manufacturing PMI data and weaker U.S. PMI figures, which increased demand for safe-haven assets. Silver also gained, following gold’s trend, as signs of growth in the Chinese economy offset weaker PMI data.

U.S. Treasury yields declined last week, with 10-year and 2-year yields pulling back. China’s 10-year bond yields also fell by approximately 7%, reflecting easing in global bond markets.

Initial Jobless Claims​

For the week ending December 28, initial jobless claims fell by 9,000 to 211,000, the lowest since a seven-month low of 213,000. The four-week moving average dropped by 3,500 to 223,250.

Chicago PMI​

The Chicago Business Barometer fell 3.3 points to 36.9 in December, marking its lowest since May 2024. Declines in New Orders and Production offset gains in Employment, Supplier Deliveries, and Order Backlogs. Prices Paid fell to the lowest since July 2024, while Inventories hit the lowest since October 2009.

SP Global Manufacturing PMI​

The S&P Global U.S. Manufacturing PMI declined to 49.4 in December, marking the sixth consecutive contraction in factory activity. Output fell fastest in 18 months due to reduced demand and weaker export orders. Firms cut purchasing but increased hiring, while input cost pressures surged, leading to higher output prices.

China Manufacturing PMI​

China's Caixin Manufacturing PMI dropped to 50.5 in December from 51.5, reflecting slower growth in output and new orders. Foreign orders declined, employment fell, and business confidence reached a three-month low. Selling prices dipped while input costs rose modestly.

ISM Manufacturing PMI​

The ISM Manufacturing PMI rose to 49.3 in December, indicating the slowest contraction since March. New Orders reached an 11-month high, while Production expanded for the first time in six months. Prices rose, reflecting persistent inflation concerns amid improved supplier deliveries.

Currencies​

The dollar index hit 109.4, its highest since October 2022, driven by robust U.S. economic growth and expectations for elevated rates under Trump’s policies. The euro fell to $1.0220 amid weak European growth and a dovish ECB, while the pound dropped to $1.239 due to the BoE’s dovish stance and stagnant UK growth. The yen gained slightly, with BoJ minutes hinting at possible rate hikes, though concerns over yen weakness persist. The offshore yuan weakened despite PBoC support, pressured by abundant liquidity and a strong dollar.

Commodities​

Gold rose 1.3% to $2,654 per ounce, driven by monetary easing, geopolitical tensions, and record central bank purchases. The outlook remains mixed as Fed caution on rate cuts weighs on demand, though central bank buying may sustain prices. Silver followed gold's trend, supported by signs of economic growth despite weaker Chinese PMI data.

Equities​

U.S. indices posted losses this week. The S&P 500 and Dow Jones fell 1.5%, while the Nasdaq dropped 2.5%, driven by a strong dollar and low trading volumes. Tech giants like Microsoft, Netflix, and Apple declined by 5%, while Starbucks and Uber gained 3% and 2%, respectively.

 

[zForex]

Weekly Analysis By zForex Research Team (13 - 17 Jan 2025)​

Gold’s Best Week Since November as Dollar Gains Amid Fed and Trump Policy​

The US Dollar Index ended the week higher, bolstered by hawkish FOMC minutes and inflation data. Despite positive PMI data and inflation figures supporting a less aggressive ECB stance, the euro weakened against the stronger dollar. The pound also fell, pressured by rising yields and capital outflows linked to inflation and fiscal instability.

Gold had its best week since mid-November, despite hawkish Fed comments. Silver posted its second consecutive weekly gain, supported by positive developments in China.

U.S. 10-year yields hit a 9-month high of 4.72%, driven by inflation concerns, while 2-year yields remained steady. Chinese 10-year yields recovered slightly to 1.67% after the PBOC paused bond purchases.

German CPI​

Germany's inflation rose for the third month to 2.6% in December, up from 2.2% in November, exceeding forecasts of 2.4%. This marks an 11-month high, driven by faster price increases in services (4.1%) and food (2%), while energy prices declined at a slower pace (-1.7%). Monthly CPI rose 0.4%, beating expectations of 0.3%. EU-harmonized CPI increased by 2.8% annually and 0.7% monthly, both above forecasts.

U.S. Service PMI​

The S&P Global US Services PMI for December was revised to 56.8 from 58.5, still above November’s 56.1, showing the fastest sector growth since March 2022. Improved client demand and accelerating new business drove growth, while inflation eased for the third month. Business confidence surged to an 18-month high, with optimism about the incoming administration.

Eurozone CPI​

Euro Area inflation rose to 2.4% in December, the highest since July, driven by energy price increases (0.1%) and rising service inflation (4%). Germany and Spain saw inflation rise to 2.8%, while Italy's slowed to 1.4%. Core inflation held steady at 2.7%, with the ECB expecting inflation to reach its 2% target by year-end.

U.S. Services PMI​

ISM Services PMI rose to 54.1 in December, up from 52.1, exceeding expectations of 53.3, marking consistent sector expansion.

U.S. Services Prices​

The ISM Services PMI Prices Index climbed to 64.4% in December, the highest since January 2024, signaling persistent inflation as prices rose for the 91st consecutive month.

U.S. JOLTS Job Openings​

Job openings increased by 259,000 to 8.1 million in November, surpassing forecasts. Gains were seen in professional services, finance, and education, while information jobs declined. Quits fell by 218,000 to 3.1 million, with layoffs steady at 1.8 million.

U.S. ADP Employment Change​

Private businesses added 122,000 jobs in December, the smallest increase in four months. The service sector led gains, particularly in healthcare, while manufacturing lost 11,000 jobs. Wage growth for job-stayers slowed to 4.6%, the lowest since July 2021.

Initial Jobless Claims​

Initial claims fell by 10,000 to 201,000 for the week ending January 4, the lowest in 11 months. The 4-week moving average decreased to 213,000 while continuing claims rose slightly to 1.867 million.

U.S. Nonfarm Payroll​

The US added 256,000 jobs in December, beating forecasts of 160,000. Gains were led by healthcare, government, and social assistance. Annual payroll growth slowed to 2.2 million jobs, below the 3 million increase in 2023.

U.S. Average Hourly Earnings​

Average hourly earnings rose 0.3% to $35.69 in December, with annual growth at 3.9%, slightly below forecasts. Non-supervisory worker earnings remained flat at $30.62.

U.S. Unemployment Rate: The unemployment rate dropped to 4.1% in December from 4.2%, with 235,000 fewer unemployed individuals and 478,000 more employed.

Currencies​

The Dollar Index rose after Fed minutes hinted at slower policy easing amid inflation concerns and Trump administration uncertainties. The euro weakened despite strong PMI data, while the pound fell due to UK inflation and fiscal instability. The yuan was stable after the PBOC paused bond purchases, citing market conditions. The Canadian dollar strengthened slightly but remains near 2016 lows amid trade concerns tied to Trump’s tariff plans and Trudeau’s resignation.

Commodities​

Gold had its best week since mid-November, despite hawkish comments from Fed members and the FOMC meeting minutes. Meanwhile, silver closed the second consecutive week in the green, driven by positive news from China.

Equities​

On the indices front, US indices ended the week lower. The S&P 500 declined by about 0.50%, while the Dow Jones lost around 0.2%. The worst performer, the Nasdaq, ended the week down by approximately 0.8%.

On the stocks front, Apple led the declines with a weekly drop of nearly 3.8%, while Tesla followed closely with a decrease of around 7%.

The most notable stocks that gained value last week were Meta, Nvidia, and Google. Meta rose by around 3%, while both Nvidia and Google increased by approximately 1.5%.

 

[zForex]

Weekly Analysis By zForex Research Team (20-24 Jan)​

Dollar Drops on Rate-Cut Hopes; Euro and Metals Rally​

The dollar index dropped 0.8% last week, breaking a six-week winning streak. Despite strong US data, hopes for Fed rate cuts rose due to weaker inflation, PPI, and retail sales. The euro gained as European inflation aligned with forecasts, Germany’s data exceeded expectations, and ECB hawkishness supported the currency.

Gold ended the week near a one-month high, gaining 1%, driven by soft US data and expectations for Fed rate cuts. Inflation concerns tied to Trump’s policies also boosted gold. Silver rose for the third week, with its outlook influenced by Chinese developments.

U.S. 10-year yields eased to 4.60% after recent highs, while Japanese yields hit a 14-year peak of 1.26%. Chinese 10-year yields attempted a recovery from historic lows of 1.65%.

U.S. PPI (MoM) (Dec)​

In December, US factory gate prices rose 0.2% MoM, slowing from November’s 0.4% increase and below the forecast of 0.3%. Goods prices surged 0.6%, driven by a 9.7% gasoline price jump, while services remained flat. Annual PPI rose to 3.3%, the highest since February 2023 but below expectations of 3.4%. Core PPI held steady at 0.2%, with the annual core rate at 3.5%, under the forecasted 3.8%.

U.S. CPI (YoY) (Dec)​

US annual inflation rose to 2.9% in December from 2.7%, matching forecasts. Energy costs fell less sharply (-0.5%), while food and transportation inflation accelerated. Monthly CPI rose 0.4%, the highest since March, led by a 2.6% energy index rise.

U.K. CPI (YoY) (Dec)​

UK annual inflation fell to 2.5% in December, below market expectations but matching the BoE's forecast. Core inflation dropped to 3.2%, with prices easing in restaurants, hotels, and services, while food costs remained steady.

GDP (MoM) (Nov)​

UK GDP stagnated in Q3 2024, with growth revised to 0%. Services showed no growth, while production fell 0.4%. Business investment rose 1.9%, but weaker government consumption and exports offset gains.

German CPI (MoM) (Dec)​

Germany’s inflation rate rose to 2.6% in December, driven by higher service and food prices. Monthly CPI increased by 0.5%, recovering from November’s decline.

Retail Sales (MoM) (Dec)​

US retail sales grew 0.4% MoM in December, the smallest rise in four months, as gains in miscellaneous and furniture stores offset declines in building materials and food services.

Initial Jobless Claims:​

US jobless claims rose by 14,000 to 217,000, surpassing forecasts of 210,000. Continuing claims dropped to 1.86 million, reflecting a relatively strong labor market.

China GDP (YoY) (Q4)​

China’s economy grew 5.4% YoY in Q4, exceeding forecasts of 5.0%. December saw strong industrial output and exports, though unemployment rose to a three-month high.

Eurozone CPI (YoY) (Dec)​

Eurozone inflation rose to 2.4% in December, with energy prices turning positive for the first time since July. Core inflation remained stable at 2.7%.

Currencies​

The dollar index fell 0.8% this week, breaking a six-week winning streak, as weaker US PPI and retail sales data increased expectations for rate cuts. The euro gained support from ECB hawkishness, while the pound weakened on disappointing UK data. The yen saw its strongest week since November on speculation of a BOJ rate hike. The loonie fell due to weak domestic data and diverging monetary policies.

Commodities​

Gold hit a one-month high, supported by weak US inflation data and Fed rate cut expectations. Silver also gained for the third week, driven by similar factors, though China’s solar sector challenges may limit demand.

Equities​

US indices posted strong weekly gains, with the Dow leading at 3.84%. Tesla surged nearly 9%, while Apple dropped 4%, continuing its downward trend.

 

[zForex]

Weekly Analysis By zForex Research Team (27-31 Jan)​

Markets Shift as Eased Inflation Fears Weigh on Dollar​

The dollar index fell as Trump’s policies eased inflation concerns, with no mention of China tariffs at the World Economic Forum. The euro rose to $1.05, supported by a weaker dollar, improving Eurozone PMIs, and expected ECB rate cuts. The yen strengthened as the BoJ raised rates to 0.5%, its highest in 16 years, with core inflation hitting 3% and potential further hikes ahead.

Gold climbed above $2,770, nearing its $2,790 record, driven by Trump’s rate cut calls, a weaker dollar, and tariff uncertainty. Silver rose above $30.70, supported by strong industrial demand, supply concerns, and optimism from China’s role as a key consumer.

Japan’s 10-year bond yields reached 1.22% after the BoJ’s hike, while China’s 10-year yields declined after a strong start. U.S. 10-year yields stayed flat.

Initial Jobless Claims​

Jobless claims rose by 6,000 to 223,000 for the week ending January 18, with the 4-week average increasing to 213,500. Insured unemployment hit 1,899,000, its highest since November 2021, while the insured unemployment rate stayed at 1.2%.

BoJ Interest Rate Decision​

The Bank of Japan raised its key rate by 25bps to 0.5%, the highest in 17 years, citing wage growth and inflation progress. The BoJ upgraded its inflation forecast to 2.7% for FY 2024 and signaled possible further hikes.

S&P Global Manufacturing PMI​

The U.S. Manufacturing PMI improved to 50.1 in January, ending six months of contraction. Factory output and new orders returned to modest growth, while inventories dropped at their fastest pace in 17 months.

S&P Global Services PMI​

The Services PMI fell to 52.8 in January, marking the slowest expansion since April. Output growth weakened, but hiring hit a 30-month high, while input costs rose, reversing a 10-month decline.

Currencies​

The dollar index dropped 0.8% last week, breaking a six-week winning streak, as weaker inflation and retail sales raised expectations for Fed rate cuts. Trump softened his stance on tariffs, reducing inflation fears.

The euro rose near $1.05, supported by a weaker dollar and stronger Eurozone PMI data. The ECB is expected to cut rates by 25bps next week while signaling further easing in 2024.

The pound climbed to $1.24 after better-than-expected U.K. PMI data. However, falling new orders and rising costs raise concerns. The BoE is likely to cut rates by 25bps in February.

The yen strengthened after the BoJ raised rates to 0.5%, the highest in 16 years. Japan's core inflation rose to 3%, supporting further tightening while manufacturing contracted for a seventh month.

Commodities​

Gold rose above $2,770 per ounce, its highest since October, driven by a weaker dollar and Trump's call for lower interest rates. Safe-haven demand persists amid tariff uncertainty and global central bank policy decisions.

Silver climbed to $30.70 per ounce, supported by Fed rate cut expectations, weaker dollar, and strong industrial demand. Supply concerns and China's role as a major consumer added to bullish sentiment.

Equities​

U.S. indices closed the week higher, benefiting from the weakness in the dollar index, marking a second consecutive week of gains. Leading the rally were stocks such as Netflix, Amazon, Meta, and Google, while Apple and Tesla stood out on the downside.

 

[zForex]

Weekly Analysis By zForex Research Team (3-7 March 2025)​

Dollar Gains as Trump Confirms Tariffs; Euro and Gold Slide
The US dollar ended the week on a strong note, buoyed by President Trump’s confirmation of 25% tariffs on Mexico and Canada.

However, weaker economic data kept the currency under pressure for the month. Meanwhile, the euro slipped below $1.04 ahead of the ECB meeting, where another rate cut is anticipated. The yen weakened slightly but maintained a 4% monthly gain, supported by expectations of a BOJ rate hike, despite uncertainty surrounding Trump’s trade policies.

In commodities, gold is on track for its first weekly loss in nine, pressured by a stronger dollar and trade tensions, though it remains higher for the month. Silver tumbled nearly 4% amid concerns over slowing demand, while Hecla Mining reported a 13% increase in silver production in 2024. The British pound fell below $1.27 as investors balanced US tariffs and Bank of England policy, with markets pricing in 59 basis points of rate cuts.
US Treasury yields declined, with the 10-year yield dropping to 4.25% and the 2-year yield settling at 4.05%. European and UK bond yields also moved lower, while Japan’s 10-year yield ended a seven-week rally, retreating to 1.37%.

EU CPI (January)
Eurozone inflation climbed to 2.5%, the highest level since July 2024, primarily driven by a surge in energy prices to 1.9%. Core inflation remained unchanged at 2.7% for the fifth consecutive month, while consumer prices declined by 0.3% month-over-month.

German GDP (Q4)
The German economy contracted by 0.2% in the fourth quarter, marking six consecutive quarters of negative growth. Exports declined by 2.2%, while imports rose by 0.5%. Weakness in household consumption and manufacturing weighed on growth, though construction investment showed signs of recovery.

US CB Consumer Confidence (February)
Consumer sentiment deteriorated, with the Conference Board’s Consumer Confidence Index falling by 7 points to 98.3, reflecting weaker expectations for business conditions and the labor market.

US New Home Sales (January)
New home sales declined 10.5% to a three-month low of 657,000, missing forecasts. Higher mortgage rates and extreme weather conditions contributed to the drop, with the sharpest declines recorded in the South, Midwest, and Northeast.

US Durable Goods Orders (January)
Durable goods orders increased by 3.1%, rebounding from a 1.8% decline in the previous month and surpassing expectations of a 2% rise.

US GDP (Q4)
The US economy expanded by 2.3% in the fourth quarter, slowing from 3.1% growth in Q3. Consumer spending remained strong at 4.2%, while fixed investment dropped 1.4%, led by a sharp contraction in equipment investment.

Initial Jobless Claims
US jobless claims surged by 22,000 to 242,000, the highest level in over two months, pointing to a gradual softening in the labor market. Claims filed by federal employees under UCFE totaled 614.
German CPI (February)
Inflation in Germany was estimated at 2.3% year-on-year, with consumer prices rising 0.4% from January. The EU-harmonized inflation rate stood at 2.8%.

Core PCE Price Index (January)
The Personal Consumption Expenditures (PCE) price index increased by 0.3%, bringing annual inflation to 2.5%, while the core PCE measure climbed to 2.6%.

Currencies
The US dollar strengthened as Trump’s tariffs on Mexico, Canada, and China neared implementation, despite soft economic data. The euro fell below $1.04, as markets anticipated an ECB rate cut. The yen slipped slightly but maintained a 4% monthly gain, fueled by expectations of a BOJ rate hike. The British pound dipped below $1.27, as markets remained cautious about BoE rate cut expectations.

Commodities
Gold recorded its first weekly decline in nine weeks, weighed down by a stronger dollar and looming trade tariffs, though it remains positive for the month. Silver declined by 4%, facing demand concerns, while Hecla Mining reported a 13% increase in silver output in 2024.

Equities
US stock indices ended the week lower, with the Nasdaq falling 4.5%. Despite strong earnings from Nvidia, the company’s stock plunged 10%, dragging down tech giants like Apple, Microsoft, and Amazon. Among the few gainers were Amgen and Starbucks.

 

[zForex]

Weekly Analysis By zForex Research Team (10 - 14 March 2025)​

Dollar Slips to 4-Month Low as Euro, Yen, and Pound Rally​

The Dollar Index extended its decline for a fifth consecutive session, reaching 103.7, its lowest level in four months, as tariff uncertainty and economic concerns weighed on sentiment. Traders now focus on the upcoming jobs report for insights into the labor market.
The Euro surged above $1.085, hitting its highest level since November 5 and marking a 4.6% weekly gain, the strongest since 2009. The rally was driven by Germany’s fiscal reforms, a cautious ECB, and a weakening dollar.
The Yen strengthened beyond 148 per dollar, reaching a five-month high, supported by safe-haven demand and growing expectations of BOJ rate hikes. Deputy Governor Uchida’s comments signaling a gradual exit from monetary easing further supported the currency.
The British Pound climbed above $1.28, its highest since November 12, benefiting from a softer dollar and expectations of prolonged UK rate hikes. Optimism surrounding a potential US trade deal and increased UK defense spending also supported Sterling’s advance.

Fixed Income
Bond markets experienced heightened volatility this week. Germany’s 10-year yield surged 20% after a debt ceiling increase, while U.S. Treasury yields edged 1.5% higher. Japan’s 10-year yield reached 1.55%, its highest level in 15 years.

EU CPI (Feb)
Eurozone inflation eased to 2.4% from 2.5% in January, slightly surpassing the 2.3% forecast. Service inflation moderated to 3.7% from 3.9%, while unprocessed food prices surged to 3.1% from 1.4%. Core inflation dipped to 2.6%, marking its lowest level since January 2022.

S&P Global Manufacturing PMI (Feb)
The index advanced to 52.7, its strongest level since June 2022, surpassing the 51.6 estimate. Growth was fueled by preemptive purchases ahead of tariffs, leading to increased output and new orders. Input and output price inflation surged to multi-year highs.

ISM Manufacturing PMI (Feb)
Climbing to 52.7 from 51.2, the index reflected the fastest expansion since June 2022. Production and new orders accelerated as firms stocked up ahead of tariffs, though hiring slowed. Inflationary pressures rose, with input costs reaching their highest level since November 2022.

ADP Nonfarm Employment Change (Feb)
Private sector payrolls expanded by 77K, the weakest gain in seven months, missing the 140K forecast. The service sector added just 36K jobs, with losses in trade, education, and IT, while the goods sector saw a 42K increase, driven by construction and manufacturing.

S&P Global Services PMI (Feb)
The index retreated to 51.0 from 52.9, below the 53.0 forecast, though revised up from an initial estimate of 49.7. Business activity slowed due to policy uncertainty and tariffs, prompting the first job cuts in three months. Export demand declined for a second consecutive month.

ISM Non-Manufacturing PMI (Feb)
The services index climbed to 53.5 from 52.8, exceeding expectations. Business activity and new orders expanded for a third month, while inventories improved. Inflation concerns persisted, with price pressures rising to 62.6 from 60.4.

Deposit Facility Rate (Mar)
The ECB lowered its deposit rate by 25 basis points to 2.5%, marking its fifth consecutive cut, bringing borrowing costs to their lowest level since February 2023.

Initial Jobless Claims (Mar 1)
U.S. jobless claims dropped by 21K to 221K, while insured unemployment rose by 42K to 1.9M. The four-week moving average edged up to 1.87M.

Average Hourly Earnings (Feb)
U.S. wages increased by 0.3%, reaching $35.93, in line with expectations, following a 0.4% gain in January. On a yearly basis, earnings advanced by 4.0%.

Nonfarm Payrolls (Feb)
The U.S. economy added 151K jobs, an improvement from 125K in January but below the 160K forecast. The healthcare, finance, and social assistance sectors led the gains, while government jobs declined by 10K.

Unemployment Rate (Feb)
The jobless rate edged up to 4.1% from 4.0%, with 203K more unemployed and 588K fewer employed. The labor force participation rate slipped to 62.4%.

Currencies
The Dollar Index (DXY) fell for the fifth straight session to 103.7, its lowest level in four months, as tariff uncertainty continued to weigh on sentiment. Although Trump suspended North American tariffs, trade policy uncertainty persisted. The euro surged past $1.085, heading for its best weekly gain since 2009, fueled by Germany’s fiscal reforms and ECB easing. The yen strengthened above 148 per dollar, hitting a five-month high on safe-haven demand and BOJ rate hike expectations. The pound climbed above $1.28, benefiting from a weaker dollar, stable UK interest rates, and optimism over potential U.S.-UK trade deals.

Commodities
Gold approached record highs, supported by uncertainty surrounding U.S. trade policies and safe-haven demand. Despite Trump suspending most North American tariffs, Canada maintained retaliatory duties, and China is set to implement countermeasures next week. Silver surged past $32 per ounce, benefiting from a weaker dollar and renewed trade tensions. Meanwhile, the U.S. imposed additional tariffs on Canada, Mexico, and China, prompting retaliatory measures from both Canada and China.

Equities
U.S. equities posted a volatile week, with major indices closing lower. The S&P 500 and Nasdaq fell by 3%, while the Dow declined by 2.8%. Nvidia tumbled 18%, dragging down other tech giants like Amazon, Netflix, and Meta, which dropped 8% each. However, Microsoft, Google, and Apple remained flat, showing relative resilience amid the broader market selloff.