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25.01.2023 Market Report


EUR/USD is holding higher ground near 1.0900 in the early European morning this Wednesday. The pair is taking advantage of a subdued US Dollar and sluggish Treasury bond yields, as investors stay wary ahead of Thursday’s US Q4 GDP. Germany’s IFO coming up next. 


GBP/USD is holding steady above 1.2300 heading into Wednesday’s London open. The US Dollar licks its wounds amid broad risk aversion and muted US Treasury yields, lending some support to the GBP/USD pair. 


USD/JPY floats above 130.00, printing mild gains around 130.30 by the press time, amid sluggish markets on early Wednesday. In doing so, the Yen pair takes clues from the inactive Treasury bond yields amid a lack of data/events at home. Also likely to restrict the quote’s immediate moves could be the market’s cautious mood ahead of the Bank of Japan’s (BOJ) Summary of Opinions and US Gross Domestic Product (GDP) for the fourth quarter (Q4), not to forget the next week’s Federal Open Market Committee (FOMC) meeting.


The AUD/USD pair has touched the 0.7100 mark for the first time in the past five months amid fresh highs in the Australian inflation rate at 7.8% on an annual basis for the fourth quarter of CY2022. The annual CPI has been released stronger than the expectations of 7.5% and the prior release of 7.3%. On a quarterly basis, the inflation rate has climbed to 1.9% vs. the consensus of 1.6% and the former release of 1.8%.


NZD/USD begins Wednesday’s trading on a firmer footing on upbeat New Zealand (NZ) inflation data, initially poping up to 0.6525 before retreating to 0.6500 by the press time. Adding strength to the Kiwi pair’s run-up could be the US Dollar’s failure to keep the late Tuesday’s gains amid dovish bias for the Federal Reserve’s next move.


USD/CAD is hovering near 1.3340 in the early European session. The Loonie asset has dropped after failing to sustain above 1.3400 and is expected to decline further to near the weekly lows around 1.3320. The major is following the footprints of the US Dollar Index (DXY), which is displaying a subdued performance.


The USD/CHF pair has sensed buying interest after dropping below 0.9220 in the early Asian session. The Swiss franc asset is gaining traction as investors are shifting their focus toward the release of the United States Gross Domestic Product (GDP) data, which is scheduled for Thursday.


Oil prices rose on Wednesday, recovering a measure of sharp losses from the prior session, although fears of a global recession and signs of another major build in U.S. inventories kept gains limited.


Gold price returns to the red amid a pause in the US Dollar sell-off. The latest uptick in the US Treasury bond yields weighs on Gold price. Investors take profits on Gold longs ahead of critical United States data.

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