Trusted by over 15 Million Traders
The Most Awarded Broker
for a Reason
CATEGORIES
News
- 【XM Market Analysis】--Pairs in Focus - Nikkei 225, S&P 500, GBP/USD, EUR/USD, Go
- 【XM Market Analysis】--AUD/USD Forex Signal: Continues to Rally
- 【XM Forex】--EUR/USD Monthly Forecast: January 2025
- 【XM Market Analysis】--NASDAQ 100 Forecast: Continues to See Pressures - Are We A
- 【XM Decision Analysis】--USD/TRY Forecast: Lira Stabilization Expected After Trea
market news
The U.S. government shutdown may cause data delays, and the Federal Reserve may make another decision!
Wonderful introduction:
Walk out of the thorns, there is a bright road covered with flowers; when you reach the top of the mountain, you will see the cloudy mountain scenery like green clouds. In this world, a star falls and cannot dim the starry sky, a flower withers and cannot desolate the whole spring.
Hello everyone, today XM Foreign Exchange will bring you "[XM Group]: The U.S. government shutdown may cause data delays, and the Federal Reserve may make another "dark" decision!". Hope it will be helpful to you! The original content is as follows:
Asian market market
On Monday, as investors rethink the Fed's interest rate cut and future plans, the US dollar index rose first and then fell. As of now, the US dollar quoted.
Feder Bostic: There is no reason to further cut interest rates, and it is expected to only cut interest rates once this year;
Musalem: There is limited room for further interest rate cuts. If the inflation risk increases, further interest rate cuts will not be supported;
·Hamak: You should be very cautious when lifting policy restrictions. My estimate of neutral interest rates belongs to the higher ones;
·Milan: You believe that the appropriate interest rate is in the middle area of 2%. There is currently no support for adjustments to the 2% inflation target.
-U.S. Treasury Secretary Becent sent a support signal, suggesting that it may lend a financial help to Argentina, and Argentina's stock market strengthened.
France and other countries recognize the Palestinian state, while the United Nations Security Council's five permanent members are not recognized by the United States.
Nvidia plans to invest US$100 billion in OpenAI to jointly build an AI data center.
Summary of institutional views
PhilipWee, a senior foreign exchange strategist at DBS Group Research: The yen is waiting for a signal in the short term or running in this range
The trend of the yenCurrently focusing on the two leaders in the election of the Liberal Democratic Party leader. If Koizumiro wins, it may be a good thing for the yen because he holds a reform stance, emphasizes fiscal discipline, and tends to support the Bank of Japan's policy normalization process. If Takashi Hayao wins, it may be detrimental to the yen because it advocates growth-first policies, supports large-scale fiscal stimulus and continued monetary easing. At present, the US dollar/JPY is more likely to remain in two-thirds of the lower range of 146-149.
UBS: Fiscal risks are approaching again, but the pound collapse may be difficult to repeat, and this level is the main support.
The latest public sector borrowing data shows that the UK government's cash demand has increased, which once again highlights its difficult fiscal situation. This puts more pressure on Chancellor Reeves and sets the fall budget announced on November 26 as a major risk event in the fourth quarter. As market attention increases, one of the government's top priorities should be to ensure its fiscal stability. The pound is highly sensitive to past fiscal stress events, and we don’t think this time will be an exception. While we do not expect pounds to be as volatile as in 2022, we have noticed that the downside risk (at least temporarily) of the pound has increased. We are currently cautious about the exposure to the pound.
However, given our negative outlook for the US dollar, the pound should still deliver positive returns in spot and arbitrage, with our pound-USD target at 1.39 at the end of the year. The pound offers attractive arbitrage opportunities for investors who can withstand potential volatility around the fall budget. We postpone expectations of the Bank of England's next rate cut to 2026 and expect only two more rate cuts in the next 12 months. Although this will bring positive arbitrage opportunities, we note that from the perspective of UK interest rates, the support role of spot interest rate repricing may be limited - the market's expectations for the Bank of England are already quite strong.
In the short term, pound-US 1.33 constitutes the main support level at the current level. The UK's fiscal situation and the upcoming fall budget are the main downside risks faced by the pound, which may push the pound back to its May and July lows of around 1.32. On the upside, the recent test of 1.37 will be an important resistance level, and this level is expected to be broken later this year.
Face Bank's Forecast US PCE: Consumer confidence collapses, but the wallet is not lost?
U.S. consumer confidence is in a downturn, although the degree of downturn is not entirely clear. The overall tone of economic surveys is mostly pessimistic, with the University of Michigan’s consumer confidence index at a deep down level, but the Chamber of xn--xm-6d1dw86k.commerce’s consumer confidence data paints a xn--xm-6d1dw86k.completely different picture, consistent with the long-term average. Still, retail and personal spending data have performed well in recent months, which may indicate that consumers are trying to dispel the haze with “shopping therapy.”
We expect that the August personal spending data will show a similar steady growth trend, although its growth momentum is not as strong as retail sales datastrength. Previously, US retail sales recorded a 0.6% increase month-on-month increase, while the control group increased by 0.7% month-on-month. Personal expenditure data will not show such strong momentum because the personal expenditure data contains much more service sub-items than retail sales data, and the actual growth of the service industry is slower. However, if the monthly rate grows above 0.5%, expenditure will once again outweigh revenue growth, just like in the past three months, while at the same time, the savings rate is very low. In other words, private consumption growth in the United States is achieved within borrowed time.
As for the inflation indicator favored by the Federal Reserve, PCE data, we expect to be as strong as CPI, with a core PCE monthly rate of 0.3%, but slightly below the overall monthly rate of 0.4%. Nevertheless, the overall inflation rate will rise by 0.2% year-on-year, and the core inflation rate will rise by 0.1% to 3.0%, the highest level since March 2024.
Goldman Sachs: The "last carnival" of US and Japanese bulls will fall on this risk event
We believe that the Fed's interest rate cut means two things to the foreign exchange market. First, it confirms our view that the U.S. economy is no longer as good as it used to be, and therefore the dollar should not be overestimated to the same extent. If the labor market continues to be weak, the market will not be optimistic that the risks have been controlled, which is why we still think it is meaningful to hedge against the United States and Japan. Second, it will change the hedging costs and help catalyze a new round of diversified flow of funds, including foreign exchange hedging of existing US dollar assets. Apart from cost transfers, we think policy makers and long-term investors may get more signals from policy rate changes, which will encourage them to hedge.
As the election of the presidential election of the Liberal Democratic Party of Japan approaches on October 4, we continue to believe that the US dollar is at risk of tactical upward pressure against the yen. It is reported that Koizumiro Koizumi and Takaichi Saena are still leaders, and both of them officially join the election. Gaoshi Zaohai supports lowering of consumption taxes and generally tends to increase fiscal easing. If her support rate progresses, the market will once again worry about its fiscal sustainability. Therefore, we currently tend to short the US dollar in other areas, including emerging market arbitrage and other cyclical currencies (such as Swedish krone, Norwegian krone, Australian dollar). We believe that the political background is at least a resistance to the yen bulls, even if it will not be the driving factor for the overall weakening of the yen in the short term. Once the event risks pass, we will seize the opportunity to shorten our positions through options. We believe that broader macro backgrounds such as lower hedging costs and rising recession risks still support the strengthening of the yen.
The above content is all about "[XM Group]: The U.S. government shutdown may cause data delays, and the Federal Reserve may make a decision again in the dark!". It was carefully xn--xm-6d1dw86k.compiled and edited by the XM Forex editor. I hope it will be helpful to your transactions! Thanks for the support!
Only the strong know how to fight; the weak are not qualified to fail, but are born to be conquered. Step up to learn the next article!
Disclaimers: XM Group only provides execution services and access permissions for online trading platforms, and allows individuals to view and/or use the website or the content provided on the website, but has no intention of making any changes or extensions, nor will it change or extend its services and access permissions. All access and usage permissions will be subject to the following terms and conditions: (i) Terms and conditions; (ii) Risk warning; And (iii) a complete disclaimer. Please note that all information provided on the website is for general informational purposes only. In addition, the content of all XM online trading platforms does not constitute, and cannot be used for any unauthorized financial market trading invitations and/or invitations. Financial market transactions pose significant risks to your investment capital.
All materials published on online trading platforms are only intended for educational/informational purposes and do not include or should be considered for financial, investment tax, or trading related consulting and advice, or transaction price records, or any financial product or non invitation related trading offers or invitations.
All content provided by XM and third-party suppliers on this website, including opinions, news, research, analysis, prices, other information, and third-party website links, remains unchanged and is provided as general market commentary rather than investment advice. All materials published on online trading platforms are only for educational/informational purposes and do not include or should be considered as applicable to financial, investment tax, or trading related advice and recommendations, or transaction price records, or any financial product or non invitation related financial offers or invitations. Please ensure that you have read and fully understood the information on XM's non independent investment research tips and risk warnings. For more details, please click here