The USD/JPY pair pulled back from its highest levels since July, retreating to 156.50 following the release of US Personal Consumption Expenditure (PCE) data.
Feed from Fxstreet.com
Talk is cheap, let’s get the vote.
Update: It sounds like this won’t be split into three parts but will just be the bill that failed yesterday but without an extension to the debt limit.
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
Congressional Republicans are in a real jam.
They need to either make a deal with Democrats (or at least a few dozen of them) to pass a bi-partisan continuing resolution and defy Trump; or they need to follow Trump’s instructions, shut down the government and hope the Democrats (and some members of their own party) cave.
It looks like they’re going to try and make another bipartisan deal as House minority leader Jeffries says the lines of communication have been reopened. If there is another deal, we will have to see how Trump (and Elon) reacts.
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
It was a busy week as traders had a ton of major catalysts to work with in the final full trading week of 2024, including the highly impactful FOMC statement!
Feed from Babypips.com
The EURUSD is stretching higher and it has now broken back above the November 26 swing low at 1.0442 and is testing its falling 100-hour moving average at 1.0443 (blue line on the chart above).
Just above that is a swing area between 1.0448 and 1.0461 and the falling 200-hour moving average at 1.04719 (green line on the chart above).
Recall that the 200 hour moving average was a strong resistance area going back to December 10. Just prior to moving lower on Decemeber 17, the price tried to extend above the 200 hour MA (see green number circle 7) but failed quickly. The price traded higher and lower on Tuesday and Wednesday before heading sharply lower on the FOMC day.
Now after bottoming near the November low, the price is stretching higher.
Also in play is the “Red Box” that confined most of the trading between 1.0448 to 1.06097.
The question is “WIll the sellers lean against old support RIGHT HERE?” or “WIll the buyers take back control after the failed break lower this week and testing the November low?” .
That is the decision right here. Be aware.
This article was written by Greg Michalowski at www.forexlive.com.
Feed from Forexlive.com
Forex traders were on their toes throughout the week, as another batch of major central bank announcements and a busy economic calendar rocked the markets.
Feed from Babypips.com
It was looking like a brutal day for European stocks but there has been a major turn in markets following the better PCE report and dip-buying ahead of a potential US government deal/
Closing changes on the day:
On the week:
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
Feed from Investing.com
These are one-month annualized numbers so small changes led to swings like this. That said, the latest number is one-month running at a sub-2% pace, 11 more to go.
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
Fed vice chair for supervision Michael Barr is worried. He was appointed in 2022 for a term that lasts until 2032 but is worried that Trump may try to remove him.
Reuters reports that he sought advice from law firm Arnold & Porter.
I’m doubt this is meaningful for markets but it does speak to real worries around Trump and the Fed. It also speaks to how strongly he might feel (or his donors might feel) about bank regulation.
Barr, like Quarles before him, rarely weighs in on monetary policy and almost always focuses on regulation and supervision of banks.
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
Markets:
The mood shifted sharply on Friday as stocks looked set for another rout in the pre-market only to reverse higher. The FX market followed a similar pattern, though the moves were less-dramatic. That meant US dollar selling after the dollar hit some of the best levels of the year early in Asia.
Two things turned markets: The PCE report and progress on avoiding a government shutdown.
On Wednesday, the Fed comments indicated a big shift towards worries about inflation but the PCE report brought a dose of reality back to the debate as the numbers were lower than expected and not at levels so worrisome that the Fed would need to contemplate hiking.
Comments from Goolsbee and Williams underscored that, assuring markets that the path for rates is still lower and that the only real debate is the pace of cuts.
Some of the machinations around the debt ceiling debate also underscored a Trump/Musk recalibration around fiscal hawkishness. It’s not yet clear how it will shake down so keep a close eye over the weekend. The real thing to watch is how the new administration prioritizes fiscal consolidation relative to corporate tax cuts. The vast majority of the market thinks the top priority is the stock market but that could be a miscalculation.
In terms of market moves, USD/JPY fell hard on some verbal intervention from Tokyo and it continued to drift lower in the US as Treasury yields ticked lower.
The euro bounced impressively after touching 1.0344 while the Australian and Canadian dollars rebounded from the worst levels of the year. The pound touched below the November lows in Asia the bounced to 1.2600 before fading 25 pips below the figure.
I would expect the first reaction on Monday to center around the government shutdown response but we’re deep into the holiday season now so the temperature might fall.
Have a great weekend.
This article was written by Adam Button at www.forexlive.com.
Feed from Forexlive.com
The Euro (EUR) trades broadly steady in the mid-1.0300s against the US Dollar (USD) on Friday even after President-elect Donald Trump threatened Europe with tariffs “all the way” unless it purchased more US energy products, Scotiabank’s Chief FX Strategist Shaun Osborne says.
Feed from Fxstreet.com