US Core PPI, UK MPC & FOMC Speeches: What’s in Focus?
FX Update
The Indian rupee slumped to a fresh all time-low and logged its biggest single-day decline in nearly two years on Monday, bogged down by a surging U.S. dollar, likely outflows from local equities and limited intervention from the central bank.
The rupee INR=IN declined to 86.5825 before ending the session at 86.5750, down 0.7% on the day. The last time it fell this much was in February 2023.
The dollar index .DXY hit an over two-year high after the U.S. jobs report reinforced the Fed’s cautious approach towards policy easing this year amid concerns of inflation from potential import tariffs under Trump.
Crude Oil:
Crude Oil extended gains for a third session on Monday, with Brent crude rising above $80 a barrel to its highest in more than four months, driven by wider U.S. sanctions on Russian oil and the expected effects on exports to top buyers India and China. Brent and WTI have climbed by almost 7% since Jan. 8, surging on Friday after the U.S. Treasury imposed wider sanctions on Russian oil. The new sanctions included producers Gazprom Neft SIBN.MM and Surgutneftegaz SNGS.MM, as well as 183 vessels that have shipped Russian oil, targeting revenue Moscow has used to fund its war with Ukraine.
Gold:
Gold prices eased as strong U.S. jobs data reinforced the Federal Reserve’s cautious stance on interest rate cuts and boosted the dollar, though underlying safe-haven demand amid uncertainty around President-elect Donald Trump’s policies curbed losses.
Copper
Copper prices hit one-month peaks on optimism about global growth and demand, particularly in top consumer China, which increased imports of the industrial metal last month. China’s imports of unwrought copper and copper products hit a 13-month high in December, rising nearly 18% year on year to 559,000 metric tons, customs data showed.
MCX Closing Update
Gold 78,166 (-0.33%), Silver 90,513 (-2.15%), Crude oil 6,862 (4.35%), Copper 828.25 (0.27%), Natural Gas 336.70 (-1.75%).
Economic Data and Event Releases yesterday
China Data Releases:
China’s Trade Balance for December, in Chinese Yuan (CNY) terms, came in at CNY752.91 billion, expanding from the previous figure of CNY692.8 billion.
Exports climbed by 10.9% YoY in December vs. 1.5% in November. The country’s imports rose by 1.3% YoY in the same period vs. 1.2% registered previously.
India’s Data Releases:
India’s December retail inflation (CPI) eased to 5.22% from 5.48% in November, marking a steady decline from October’s 14-month high of 6.21%, now within the RBI’s 2-6% tolerance band.
Economic Data and Event scheduled today – US Core PPI, UK MPC & FOMC Speeches
Japan
At 5.20am –
Bank Lending y/y. Data is foreseen at 3.1% from previous 3.00%.
Current Account. Data is foreseen at 2.59T from previous 2.41T.
At 10.30am – Economy Watchers Sentiment. Data is foreseen at 49.40 from previous 49.40.
Above data could have a mixed impact on the Yen.
UK
At 2.00pm- MPC Member Breeden Speaks
Above data and speech could have a mixed impact on the pound.
Eurozone
At 1.15pm – French Gov Budget Balance.
At 2.30pm- Italian Industrial Production m/m. Data is foreseen at 0.0% from previous 0.0%.
Above data could have a mixed impact on the Euro.
US
At 4.30pm-NFIB Small Business Index. Data is foreseen at 101.30 from previous 101.70.
At 7.00pm-
Core PPI m/m. Data is foreseen at 0.2% from previous 0.2%
PPI m/m. Data is foreseen at 0.4% from previous 0.4%
At 8.30pm- FOMC Member Schmid Speaks.
Above data could have a volatile impact on the dollar.
Until then, Happy Trading!
Commodity Samachar Securities
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