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03.01.2023 Market Report


EUR/USD is holding steady above 1.0650, paring back gains heading into the European open. The US Dollar is trading choppy in a narrow range, having paused its decline amid an upbeat risk sentiment. Germany’s inflation data is awaited. 


GBP/USD is holding onto the latest upswing toward 1.2100, as bulls jump back into the game amid holiday-thinned market conditions. The main catalyst behind the pair’s renewed upside is the fresh round of selling seen in the US Dollar across the board. As the broad market sentiment is improving, the safe-haven US Dollar is fading its recovery attempts amid a subdued performance in the US Treasury bond yields. Upbeat Chinese Caixin Manufacturing is helping lift the overall market mood, with the US S&P 500 futures wiping out entire losses.


USD/JPY is under intense selling pressure below the 130.00 level, having hit fresh six-month lows at 129.51 in the last hour. The sudden downturn got triggered after the pair faced rejection at daily highs of 131.40, helped by the BoJ speculation and thin liquidity. 


The AUD/USD pair is displaying a steep fall and has dropped sharply to near 0.6773 despite the IHS Markit reporting better-than-anticipated Caixin Manufacturing PMI data. The economic data has landed at 49.0, higher than the consensus of 48.8 but lower than the prior release of 49.4.


The NZD/USD pair has witnessed a sell-off in the Asian session despite upbeat China’s Caixin Manufacturing PMI data. The Kiwi asset has dropped to near the 0.6300 mark despite figures remaining better than expectations but lower than the former release. The release of the economic data at 49.0 vs. the projections of 48.8 might support the New Zealand Dollar ahead, being one of the leading trading partners of China.


The USD/CAD pair is displaying some volatile moves in the early Tokyo session after failing to overstep the immediate mark of 1.3580. The Loonie asset is attracting offers led by improving investors’ risk appetite and an expansion in the oil price.


The USD/CHF pair is likely to display a lackluster performance ahead around 0.9250 amid festive mood in various potential markets. Also, the Swiss franc asset is expected to remain sideways as investors are awaiting the release of the Swiss Consumer Price Index (CPI) data for fresh impetus.


Oil prices fell on Tuesday, logging a soft start to 2023 as a warning on economic growth from the International Monetary Fund and increased concerns over China’s COVID-19 crisis brewed uncertainty over strength in demand.


Gold price is flirting with seven-month highs above $1,840 so far this Tuesday. Gold price is seeing a continuation of the recent uptrend at the start of 2023, as the bounce in the US Dollar fades amid a fresh USD/JPY sell-off and improving risk sentiment. 

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