Europe Roundup: Sterling gains on upbeat retail sales data, European shares climb, Gold hits one-week high , Oil steady as oil supply risks meet economic headwinds-May 20th,2022

Posted at 20 May 2022 / Categories Market Roundups

Market Roundup

 •UK Apr Retail Sales (YoY) -4.9%,-7.2% forecast, 0.9% previous

•UK Apr Core Retail Sales (MoM) 1.4%, -0.2% forecast, -1.1% previous

•UK Apr Core Retail Sales (YoY) -6.1%,-8.4% forecast,-0.6% previous

•UK Apr Retail Sales (MoM) 1.4%,-0.2% forecast, -1.4% previous

• German Apr PPI (YoY)  33.5%, 31.5% forecast,30.9% previous

•Swiss Industrial Production (QoQ) 7.9%,7.9% previous

•Belgium  May Consumer Confidence -13, -14 previous

Looking Ahead - Economic Data (GMT)

•13:30 Canada ADP Nonfarm Employment Change 475.0K previous

•17:00 U.S. Baker Hughes Oil Rig Count 563 previous

•17:00 U.S. Baker Hughes Total Rig Count 714 previous

Looking Ahead - Economic events and other releases (GMT)

•No events ahead


EUR/USD: The euro steadied against dollar  on Friday  as risk sentiment improved following China’s rate cut. China cut its five-year loan prime rate (LPR) - which influences the pricing of mortgages - by 15 basis points on Friday morning, a sharper reduction than expected, as authorities seek to cushion the impact of an economic slowdown. It left the one-year LPR unchanged. The euro also  benefitted from the dollar's weakness, and was on track for a weekly gain of 1.7%. It was last trading at $1.0566. Immediate resistance can be seen at 1.0612(38.2%fib), an upside break can trigger rise towards 1.0634 (30DMA).On the downside, immediate support is seen at 1.0550 (14DMA), a break below could take the pair towards 1.0499(23.6%fib).

GBP/USD: Britain’s pound strengthened against the dollar on Friday as upbeat UK retail sales data boosted pound. British retail sales jumped unexpectedly in April as shoppers loaded up on alcohol and tobacco, likely a blip in an otherwise bleak trend that has driven consumer confidence to all-time lows amid a worsening cost-of-living crunch.Retail sales volumes rose 1.4% month on month after a 1.2% drop in March, the Office for National Statistics said. Economists polled had expected a 0.2% monthly fall. Immediate resistance can be seen at 1.2542(50%fib),an upside break can trigger rise towards 1.2636(61.8%fib).On the downside, immediate support is seen at 1.2449 (38.2%fib), a break below could take the pair towards 1.2372 (14DMA).

USD/CHF: The dollar declined against the Swiss franc on Friday as some of the heat faded from the dollars breakneck 10% surge. The greenback has been supported by a flight to safety by investors, amid a rout across markets due to fears of the impact of soaring inflation and Russia's invasion of Ukraine But after rising in all but two of the last 14 weeks, the dollar index was on track for a 1.6% weekly fall on Friday. The index, which tracks the dollar against six other major currencies, dipped 0.1% on the day to 102.82. Last Friday, it soared to the highest since January 2003 at 105.01. The Swiss franc was last up a quarter of a percent at 0.97040 franc .Immediate resistance can be seen at 0.9816(23.6%fib), an upside break can trigger rise towards 0.9883 (14DMA).On the downside, immediate support is seen at 0.9694(38.2% fib), a break below could take the pair towards 0.9600 (50%fib ).

USD/JPY: The dollar edged lower against the Japanese yen on Friday as dollar took a breather on  deepening concerns over U.S. economic growth. The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, reaching a four month-high and potentially hinting at some cooling in demand for workers amid tightening financial conditions. Although the number of Americans on jobless rolls are at its lowest since 1969 in early May, weekly jobless claims unexpectedly rose last week. Strong resistance can be seen at 128.128(23.6%fib), an upside break can trigger rise towards 129.16(14DMA).On the downside, immediate support is seen at 127.00(Psychological level), a break below could take the pair towards 126.40(38.2%fib).

Equities Recap

European stocks rebounded on Friday after China cut its key lending rates by a record quantum to spur growth.

At (GMT 13:19 ),UK's benchmark FTSE 100 was last trading up at 1.62 percent, Germany's Dax was up  by 1.80 percent, France’s CAC was last up  by 1.29 percent.

Commodities Recap

Oil prices were largely steady on Friday and on course for little change on the week as a planned European ban on Russian oil balanced out investor concerns about weakening economic growth hitting demand.

Brent futures for July were up 49 cents, or 0.4%, to $112.53 a barrel by 1100 GMT, while U.S. West Texas Intermediate (WTI) crude for June rose 24 cents, or 0.2%, to $112.45 on its last day as the front-month.

Gold prices firmed on Friday and were poised for their first weekly gain since mid-April as a pullback in the dollar from two-decade highs and deepening concerns over U.S. economic growth burnished the metal's safe-haven appeal.

 Spot gold  was up 0.2% at $1,844.48 per ounce by 0751 GMT, after rising as much as 1.9% in the previous session. U.S. gold futures were nearly flat at $1,840.80. 

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