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19.12.2022 Market Report


EUR/USD seesaws near 1.0600, snapping a two-day downtrend in the early European morning. The pair’s sideways trading could be linked to the cautious sentiment amid China’s covid concerns and Euro area recession fears. Germany’s IFO survey eyed. 


GBP/USD is consolidating the rebound below the 1.2200 threshold, as bulls trade with caution amid a downbeat market mood at the start of the week on Monday. Broad-based US Dollar weakness is underpinning the uptick in the Pound Sterling.


USD/JPY holds lower grounds near the intraday bottom of 135.77 as the Yen buyers keep the reins ahead of this week’s Bank of Japan (BOJ) monetary policy meeting. With this, the quote prints a two-day downtrend as traders anticipate hawkish signals from the Japanese central bank as the utter dove Governor Haruhiko Kuroda nears his retirement looming in April.


The Australian dollar is weaker this morning when valued against the Greenback amidst a dampened market sentiment as an economic slowdown looms. This came after a slew of central banks featuring the US Federal Reserve (Fed), the Bank of England (BoE), and the European Central Bank (ECB) raising rates by 50 bps each. Additionally, policymakers emphasized the need to do what’s needed to tackle inflation, which keeps investors uneasy. Earlier this month we saw the Reserve Bank of Australia (RBA) hike rates again by 25bp in the December meeting.


NZD/USD is up at the start of the week, higher by 0.14% having popped from a low of 0.6368 to a high of 0.6368 so far despite the market mood turning dark upon further reflection of last week’s Federal Reserve meeting. The US Dollar climbed on Friday as risk appetite soured and investors weighed the prospect that the Fed and other central banks still had some way to go. 


USD/CAD consolidates intraday losses as it grinds higher around 1.3680, following a downbeat start to the week. That said, softer US Dollar and optimism surrounding Crude Oil seemed to have contributed to the Loonie pair’s first daily loss in three before the latest paring of moves amid a light calendar and mixed concerns. US Dollar Index (DXY) picks up bids from intraday low but prints 0.15% daily loss around 104.60 as traders struggle for clear directions. The reason could be linked to the hawkish Fedspeak and softer US PMIs for December.


USD/CHF holds lower ground near the intraday bottom as bears struggle to retake control, after a two-day leave, during early Monday. That said, the Swiss Franc (CHF) pair prints mild losses near 0.9320 by the press time.


Oil rose on Monday as the prospect of demand recovery, led by China’s loosening of COVID-19 curbs and the United States’ decision to buy back oil for its state reserves, gained the upper hand over global recession fears.


Gold price is treading water just below $1,800, as investors fail to find a clear directional impetus amid a broadly weaker US Dollar and higher Treasury bond yields. The US Dollar is feeling the pull of gravity, dragged down by the USD/JPY sell-off.

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