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10.03.2023 Market Report


EUR/USD is treading water just below the 1.0600 mark ahead of the European open. The pair is defending minor gains amid a rebound in the US Dollar, as risk sentiment sours ahead of the critical US Nonfarm Payrolls data and ECB Chief Lagarde’s speech. 


GBP/USD is recovering losses while trading above 1.1900 ahead of the UK GDP and Industrial production data. A minor recovery in the US Dollar and the risk-off market profile is capping the rebound in the GBP/USD pair. US NFP data is awaited as well. 


Early on Friday, around 03:00 AM GMT, the Bank of Japan (BoJ) will announce the ordinary monetary policy meeting decisions taken after a two-day brainstorming. Following the rate decision, BoJ Governor Haruhiko Kuroda will attend the press conference, around 06:00 AM GMT, to convey the logic behind the latest policy moves.


The AUD/USD pair has printed a fresh four-month low at 0.6563 in the Asian session. The Aussie asset is facing immense pressure as the US Dollar Index (DXY) has shown a recovery move after a correction to near 105.13. Although the recovery move from the USD Index is not strong enough, the Australian Dollar is struggling to firm its feet as optimism linked with China’s economic recovery is fading and the Reserve Bank of Australia (RBA) is considering the current monetary policy is restrictive enough to bring down the sticky inflation.


The NZD/USD pair was struggling to firm its feet above the 0.6100 mark. The Kiwi asset has surrendered the aforementioned resistance in the Asian session as the US Dollar Index (DXY) has attempted a recovery after a corrective move to near 105.13. A recovery move from the USD Index was highly anticipated as investors usually get anxious ahead of any critical event.


USD/CAD dribbles around 1.3830-20 as bulls catch a break around the highest levels since late October 2022 after a four-day uptrend. In doing so, the Loonie pair portrays the market’s anxiety ahead of the key employment data from the US and Canada while also justifying a pause in the WTI crude oil’s fall, due to Ottawa’s reliance on Oil as the key export item. The Loonie pair rose in the last four consecutive days as the monetary policy divergence between the Bank of Canada (BoC) and the Federal Reserve (Fed) joins downbeat Oil price. Adding strength to the pair’s upside momentum could be the broad US Dollar strength, ignoring the latest retreat, during the uncertain times.


The USD/CHF pair has displayed a sheer downside to near 0.9320 as investors have ignored risks associated with bigger rates announcements and higher terminal rates as endorsed by Federal Reserve (Fed) chair Jerome Powell in his testimony before Congress. The Swiss Franc asset is expected to continue its downside move to near the 0.9300 mark amid an absence of loss in the downside momentum.


Oil prices fell further on Friday as markets awaited labor market data for more cues on U.S. monetary policy, although fears of rising interest rates and disappointing data from China put crude on course for steep weekly losses.


Gold price remains pressured around the intraday bottom near $1,828 as markets brace for the US jobs report, after witnessing a haywire move on the Bank of Japan’s inaction, during early Friday. 

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