Daily Forex News

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RBNZ Survey – Inflation is expected to rise & to be around 3%

Aggressive polls at the Reserve Bank showed a very sharp rise in expectations for future inflation. The results of the RBNZ’s latest quarterly forecast survey could fuel speculation that the RBNZ could raise its official cash rate by up to 50 basis points in a November 24 interest rate review. Click here for details of the survey results. The RBNZ has been tracking this survey very closely and in some cases was very strongly influenced by the results of interest rate decisions. At least for the latest results, next week’s OCR should increase by 25 basis points to 0.75%. Satish Ranchhod, a senior economist at Westpac, said the latest poll, along with other recent data, “shows increased inflationary pressures in the medium term.” Most notable in the survey is two-year inflation expectations.

In general, these numbers do not fluctuate much between surveys. However, in the latest survey, inflation expectations rose from 2.27% three months ago to 2.96% in two years. This is a huge step according to the criteria of this study.

The 2.96% value is the highest since the 3.00% value in the same survey in June 2011. Prior to June 2011, the same survey had to go back to the early 1990s to find higher numbers. Short-term inflation expectations for one year have risen from 3.02% three months ago to 3.7% in the latest survey.

The latest number is definitely to worry about the RBNZ. Perhaps he is most plagued by inflation expectations five years from now. This particular survey had only expectations for the five years from 2017 and this time, in about five years, that number has reached a record high, rising from 2.03% three months ago to 2.17%. That’s a big step. And, as I said, it may be the most worrisome statistic of the whole survey. The RBNZ wants long-term inflation expectations to be “fixed” at around 2%, which may indicate that companies will budget higher prices in the future, so this rise we concerned. The poll results are the last important part of the economic puzzle ahead of the RBNZ’s next interest rate decision on Wednesday, November 24th.

And poll results follow other economic data that continue to faint positively. As RBNZ raised the OCR from 0.25% to 0.5% on October 6, the annual inflation rate at the end of September was 4.9%, much higher than expected, and the unemployment rate was much lower than expected. .. The

RBNZ has two goals: keep inflation within 1% and 3% and support maximum sustainable employment. Now, while current inflation is clearly out of range, economists believe that they have already reached the maximum level of sustainable employment; a labor shortage is clear and can put upward pressure on wages.

 

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Gold price outlook: XAU/USD Bulls bullish amid weak US dollar in Asia

Asia’s gold is rallying as the US dollar offset some of its overnight gains as the US dollar breaks new cyclical highs following the re-election of Fed Chairman Jerome Powell. According to ANZ Bank analysts, the market immediately began pricing in relation to a gradual reduction in asset purchases and interest rate hikes through June. “This caused gold to plummet after 10-year Treasury yields raised more than 8 basis points.”

Meanwhile, yellow metals were supported by rising idle winds. “This ultimately catalyzed the company to break out of a months-long decline from historical highs, driven by a significant wave of CTA short coverage and growing Chinese demand for gold, explained analysts at TD Securities. “But we do note that the battle between high inflation and market prices caused by central bank inflation is not over.”

Going forward, the Fed minutes will be events for the dollar and yellow metal. Markets will be looking for new clues as to when to raise interest rates on how quickly the Fed can shrink. “The protocol will undoubtedly reflect a variety of risk perspectives, but most officials don’t think they will be in a hurry to raise rates given the massive net job loss and expected slowing inflation, said analysts at TD Securities.

 

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Can daily news make an impact on of any currency pair?

 

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Can daily news make an impact on of any currency pair?

Yes

 

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USD/JPY rise above 115.00 when bullish track hits 44-month high

The USD/JPY bull is breathing around 115.10 after a spike that broke a multi-month high earlier on Wednesday. At the same time, the yen is struggling to extend its two-day rally amid falling US Treasury yields. The 10-year U.S. Treasury yield fell 0.8 basis points (bps) from its highest level since October 22, or about 1.65% at the latest, amid a lack of significant data/events. Yields jumped to a one-month high before mixed US data stopped bonds rising. Geopolitical concerns and recent COVID-19 concerns appear to be playing a challenging role for USD/JPY buyers in recent times.

Japan’s geopolitical tensions with China are escalating over issues related to Vietnam. The defense ministers of Japan and Vietnam reached an agreement on the 10th that “they are opposed to secretly mentioning the sea in response to a unilateral attempt to change the status quo in the region said Kyodo News.” The Netherlands is experiencing a COVID-19 crisis and has recently announced regional closures, but the situation has not improved, driving demand for the Japanese yen, especially amid falling yields.

“The Netherlands started transporting COVID-19 patients across the border to Germany on Tuesday to ease pressure on Dutch hospitals, which are scaling back regular care to deal with a surge in COVID-19 cases,” said Reuters. Also positive for the JPY could be the improvement in COVID-19 conditions at home and the government’s readiness to help the nation overcome the pandemic led economic hardships. Recently, Nikkei reported that Japan will allocate about 600 billion yen ($5.2 billion) from its fiscal 2021 supplementary budget to support advanced semiconductor manufacturers including the world’s No. 1 contract chipmaker, Taiwan Semiconductor Manufacturing Co (TSMC), per Reuters. Against this backdrop, US equity futures are struggling to maintain their rebound from their two-week lows, while Asia Pacific stocks are trading alongside the Japanese Nikkei 225, down 0.80% at press time. USD/JPY could see further declines when considering the consolidation of returns along with a cautious outlook ahead of major US data/events.

Recent FOMC minutes and October PCE core inflation are among the catalysts for the US as expectations for a Fed rate hike rise. Against this backdrop, US equity futures are struggling to maintain their rebound from their two-week lows, while Asia Pacific stocks are trading alongside the Japanese Nikkei 225, down 0.80% at press time. USD/JPY could see further declines when considering the consolidation of returns along with a cautious outlook ahead of major US data/events.

 

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EUR/GBP hovers around 0.8400, ECB’s Lagarde and BOE’s Bailey keep an eye on

EUR/GBP remained bearish in the early hours of Thursday morning in Europe. Cross-currency pairs are approaching their annual lows recorded on Monday as fears over coronavirus in the eurozone are resurfaced. Record high cases in Germany, followed by Austria and the Netherlands, have resulted in multiple warnings reminiscent of the blockade in the region. Coronavirus infections broke records in parts of Europe on Wednesday as Europe became the epicenter of the epidemic that caused new travel restrictions. It is worth noting that the resurgence of the virus eases pressure on the European Central Bank (ECB) to follow the Western banks and thus puts further downward pressure on EUR/GBP.

In a recent commentary, Boštjan Vasle, a member of the Governors’ Council and Governor of the Central Bank of Slovenia, along with politicians Fabio Panetta and Robert Holzmann, ignored the rate hike negotiations. In contrast, European Central Bank governor and Bundesbank president Jens Weidmann said on Wednesday that inflation risks dominate in Germany and the rest of the eurozone. With block wrestling with covid, the UK is not far behind as daily infections exceed 43,000 and virus deaths drop to 149. However, Sky News cites UK health experts to point out the risk of a surge in COVID-19 cases in the new year.

Coronavirus pessimism and consequently increased pressure on the European Central Bank (ECB) to expand monetary easing, and in contrast to optimistic UK fundamentals, recent headlines on Brexit suggest the resilience of the pound I support it. Downing Street spokesperson #10 said there were significant differences between the UK and EU views on Northern Ireland, but British Prime Minister Boris Johnson’s willingness to work hard to address the issue is encouraging in the market. . But British politicians also agreed with Irish Prime Minister Michael Martin that Article 16 would not come into force until negotiations broke down.

However, a light calendar with only US public holidays and Germany’s final third-quarter GDP figures is expected to confirm the 1.8% forecast, challenging the EUR/GBP move ahead of the speeches by ECB Governor Christine Lagarde and Bank of England Governor Andrew Bailey. .

Bailey looks set to support the latest improvements in UK fundamentals to bolster hawkish hopes, but ECB’s Lagarde may risk worsening block economy due to coronavirus, which could put pressure on EUR/GBP prices can.

 

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GBP/JPY: Brexit, full-fledged bear dominating below 153.00 on COVID-19 chatter

GBP/JPY licks the cut at the 152.70 area after hitting a week-long high before hitting a two-week low of 152.47 ahead of the London opening on Friday. The Cross saw a double attack as it served food to bears amid fears of coronavirus and Brexit-related concerns. 4,444 French fishermen prepare to shut down Channel Tunnels and major ports on Friday to celebrate their disappointment over the UK’s fishing license regulations.

The British government has already urged politicians not to use illegal means, but this is unlikely to stop France’s outrage.
On the positive side, Maroš Šefchovic’s visit to London, an EU exit officer, is a British diplomat if both parties agree on a border protocol with Northern Ireland (NI), which has recently shown positive progress. It is worth noting that the previous day’s refusal of Bank of England (BOE) Governor Andrew Bailey’s inflation concerns reduces the likelihood of a rate hike and also affect GBP / JPY prices.
Or, Japan’s recent announcement and Moody’s rating outlook are adding to more robust inflation data to further drive the yen’s appreciation.

“If a new coronavirus variant is identified, we will revisit border control as needed,” said Hirokazu Matsuno, Chief Cabinet Secretary of Japan, according to Reuters. As for data, Japan’s consumer price index (CPI) rose from 0.1% year-on-year to 0.5% in November, and fresh food CPI fell from 0.4% in market forecasts to 0.3%. 0, 1% faster. In addition, CPI ex Food and Energy were 0.3% of expectations on an annual basis.

Elsewhere, concerns about the Fed’s rate hikes at the wrong time are squeezing market sentiment and supporting the US dollar’s demand for safe haven. However, the Covid19 issue has spread outside Europe’s first horror zone due to concerns about a variant of the official name B.1.1.529, which is related to South Africa and is unaffected by the vaccine. For this reason, the World Health Organization (WHO) and UKHSA held a special session on Friday.

Sentiment on 10-year Treasuries yields on US Treasuries fell 8 basis points (bps) to 1.565%, extending Wednesday’s recession from its monthly highs and S & P 500 futures falling 1.0% at the latest.

 

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GBP/USD remains weak below 1.3350 amid omicron concerns and Brexit concerns
GBP/USD is trading moderately below 1.3350, consolidating from its 11-month low of 1.3278, with risk sentiment improving slightly. Despite the risk reset, the risk remains downward biased against the majors as they continue to face the latest Omicron covid and ongoing Brexit issues.

Risk sentiment took a hit in early Asia, and concerns over the latest covid variant shook the market, propelling the overall rebound of the US dollar. South Africa’s recent surge in COVID-19 cases, which appears to have been triggered by a new strain, is urging countries around the world to impose new restrictions. However, Dror Mezorah, head of the coronavirus department at Hadassah University Hospital in Ein Karem, said the clinical status of people infected with Omicron is encouraging.

Despite risk recovery, sentiment around the pound can remain compromised by ongoing Brexit concerns. Vice-President of the European Commission, Margaritis Schinas, said Britain needed to resolve the post-Brexit immigration issue on Saturday.

Meanwhile, French President Emmanuel Macron attacked British Prime Minister Boris Johnson in a letter tweeted Friday and accused him of being “not serious.” This is in light of the ongoing tensions surrounding the Franco-British fishery. We will continue to lead the update of Omicron Covid variants and their impact on risk sentiment on Monday’s UK and US economic calendars. Investors are trying to reassess the Bank of England’s (BOE) rate hike expectations in light of recent Covid claims. This could be a further downside to the UK currency.

The dollar was up on Monday morning in Asia, with investors slowly regaining their risk appetite after the discovery of the omicron COVID-19 variant. However, caution remained as research continues on this new strain.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies edged up 0.19% to 96.290 by 10:52 PM ET (3:52 AM GMT), after falling to a one-week low of 95.973 on Friday. Although the safe-haven U.S. currency is poised to benefit from the uncertainty, the outlook for when the U.S. Federal Reserve and other key central banks will hike interest rates is now uncertain.

 

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US dollar is helpless before US Nonfarm Payrolls, 94.60’s and 95.80’s peered toward

The dollar record (DXY) fell vigorously on Thursday to a more than fourteen day low as national banks play find the Federal Reserve while, simultaneously, Fed authorities have toned down super hawkish way of talking. The euro, by a wide margin, the biggest part of the file, making up 57.6% of the DXY container, bounced against the dollar after remarks from Europea Central Bank president Christine Lagarde fuelled assumptions for quicker money related strategy tightening. When she was addressed about whether the ECB was “far-fetched” to raise rates this year, Lagarde said it would survey conditions cautiously and be “information subordinate”. This leaves March as a key gathering where the ECB could flag a significantly more hawkish position. Eurozone currency markets are presently estimating a 80% opportunity of a 10 bps climb in June and a practically 100 percent chance of 40 bps of climbs by year-end, from a 90% opportunity of 30 bps climbs before Lagarde’s question and answer session.

In the mean time, the Bank of England raised financing costs to 0.5% and almost a large portion of its policymakers needed a more critical increment to contain uncontrolled value pressures. This also has overloaded the DXY. GBP makes up 11.9% of the list. In any case, other than the hawkishness at national banks, the US dollar has unhinged for the current week from the Fed-bid.

The blend of less hawkish comments toward the beginning of the week from a tune of Fed authorities, more vulnerable positions information and a slide in ISM administrations from the earlier month are pulling the DXY lower. Hazard hunger has likewise returned creeping into worldwide business sectors. DXY fell under 96 DXY on Thursday as an outcome.

The spotlight will currently be on Friday’s Nonfarm Payroll. Payrolls probably plunged in January, yet simply because of brief Omicron aftermath because of the huge number of individuals phoning in debilitated early the month before. This would be relied upon to be reflected in the information. Experts at TD Securities contended that ”few Fed authorities have effectively clarified that they will limit feeble information as brief. Likewise, we see potential gain hazard on normal hourly profit, with a generally solid pattern prone to be added to by transitory Omicron impacts connecting with the arrangement of payrolls and the length of the week’s worth of work. Our 0.6% MoM gauge for hourly income suggests 5.3% YoY, up from 4.7% YoY in December.”

The Federal Reserve is relied upon to glance through any close to term shortcoming in the work market, and in this way will climb in March no matter what the upcoming positions information result, as experts at Brown Brothers Harriman clarified. ”In the event that work market shortcoming continues for a very long time past this, the Fed will reexamine its probably rate way.”

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GBP/USD falls from 1.3080 as the DXY declines on improved risk appetite

The GBP/USD pair has seen some hefty bids at 1.3080 as investors’ risk appetite improves and risk-perceived assets acquire more demand. Previously, the cable underperformed despite the Bank of England’s tightening monetary policies (BOE). To counteract rising inflation, the Bank of England raised interest rates to 0.75 percent. The central bank increased its benchmark interest rate three times in a row, each time by 25 basis points (bps). In addition, the UK’s Office for National Statistics published the annual Consumer Price Index (CPI) at 6.2 percent, which was much higher than market expectations and prior readings of 5.9 percent and 5.5 percent, respectively. A higher-than-expected report of UK inflation may drive the BOE to raise interest rates again in May.

The US dollar index (DXY) has hit a roadblock after failing to set a new nine-month high and is on the danger of falling below 99.00. The DXY has been pounded at 99.30 due to an increase in risk appetite following the absence of three major Moscow demands: denazification, demilitarization, and legal protection for the Russian language in Ukraine. Meanwhile, the 10-year US Treasury yield is hanging around 2.46 percent ahead of the release of US Nonfarm Payrolls (NFP) on Friday. The early estimate of US NFP at 475K is a considerable decrease from the prior print of 678K.

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XAU/USD pair remains bullish as the US currency continues to fall

The gold price is rising as the US currency and US yields fall. The 10-year yield is down almost 2% on the day, while the DXY index, which measures the US dollar against a basket of currencies, is down about 0.3 percent at the time of writing. Russia has promised to pull back military activities near Ukraine’s capital and north, while Kyiv has recommended that Ukraine join the EU while remaining neutral by not joining NATO.

“Talks were fruitful enough for Putin and Zelensky to meet,” said Ukrainian presidential advisor Mykhailo Podolyak. “We have documentation ready today that will allow the presidents to meet bilaterally,” he added. However, overall, movement has been very subdued. This suggests that the Russia-Ukraine conflict is not as priced in as some may have expected, or that markets are not fully buying it. Markets have been up and down in the previous 24 hours. The most important event, however, was the increase in 2Y UST rates to 2.45 percent yesterday, as well as yield curve inversions.

Market investors have pounced on gold (XAU/USD) as safe-haven assets lose attractiveness as peace negotiations between Russia and Ukraine continue. This week, the precious metal fell precipitously after failing to hold above the $1,950.00 level. Despite a response purchase just below $1,900, gold prices have risen to about $1,920.00. The Russian government has ignored the opening step of a ceasefire with Ukraine and has evacuated its soldiers from northern Ukraine and Kyiv. While Ukraine has declared itself neutral and has elected not to join the NATO alliance.

Moscow and Kyiv’s opening move toward a ceasefire plan has lifted market mood. Risky assets are gaining momentum in the midst of a strong risk-on drive. Meanwhile, the US dollar index (DXY) has been subjected to a barrage of selling in safe-haven assets. The DXY is retracing to approximately 98.00, its low from Tuesday, and is expected to continue its losses once the latter is violated. The Federal Reserve (Fed) has a better chance of raising interest rates by 50 basis points (bps) despite weak US JOLTS Job Openings data. The JOLTS Job Opening number was 11.266M, slightly higher than the prior result of 11.263M and the projection of 11M.

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The US Dollar Index is testing 4-week lows at 97.70 ahead of data

The greenback has been under pressure this week, trading at multi-week lows of 97.70 when measured by the US Dollar Index (DXY) on Thursday. For the third session in a row, the index loses ground and trades at the 97.70 level, despite a cautious posture in wider risk appetite trends and resumed demand for bonds. On the latter, US yields continue to lose momentum and grind lower from recent peaks, with the US 10y benchmark falling for the third straight day to approximately 2.30 percent (down from around 2.55 percent on Friday).

On the geopolitical front, increased scepticism prevails in reaction to apparent progress in the ongoing Russia-Ukraine peace negotiations in Turkey, which have so far failed to produce any serious follow-up. Initial Claims are due in the US data sector, followed by inflation as defined by the PCE, Personal Income/Spending, and the Chicago PMI.

In addition, J.Williams of the New York Fed (permanent voter, centrist) is scheduled to speak. The index stays on the defensive, retesting the first support zone at 97.70.

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US Dollar Price Action Setups: EUR/USD, USD/NZD, GBP/USD, USD/JPY

NZD: Business NZ Services Index, it measures level of a diffusion index based on surveyed purchasing managers in the services industry.

GBP: Rightmove HPI m/m, it measures change in the asking price of homes for sale.

EUR: German PPI m/m, it measures change in the price of goods sold by manufacturers.

GBP: MPC Member Haskel Speaks, BOE MPC members vote on where to set the nation’s key interest rates and their public engagements are often used to drop subtle clues regarding future monetary policy.

EUR: ECB President Lagarde Speaks, As head of the ECB, which controls short term interest rates, she has more influence over the euro’s value than any other person. Traders scrutinize her public engagements as they are often used to drop subtle clues regarding future monetary policy.

GBP: MPC Member Mann Speaks, BOE MPC members vote on where to set the nation’s key interest rates and their public engagements are often used to drop subtle clues regarding future monetary policy.

EUR: ECB President Lagarde Speaks, As head of the ECB, which controls short term interest rates, she has more influence over the euro’s value than any other person. Traders scrutinize her public engagements as they are often used to drop subtle clues regarding future monetary policy.

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As US administration strives for lower gasoline cost, oil prices are falling

Oil prices fell sharply in early trade on Wednesday, despite US President Joe Biden’s efforts to lower increasing fuel costs, which included pressure on large US corporations to help drivers during the country’s peak summer demand. At 00:31 GMT, US West Texas Intermediate (WTI) crude futures were down $1.34, or 1.2 percent, to $108.18 a barrel, while Brent crude futures were down $1.33, or 1.2 percent, to $113.32.

As the US battles rising gasoline costs and inflation, US President Joe Biden is poised to ask for a temporary suspension of the 18.4-cent-per-gallon federal gasoline tax on Wednesday, according to a person briefed on the proposal. On Monday, Biden said he was debating whether or not to run for president.

“Even oil traders recognized that higher oil prices would lead to a more aggressive tag team onslaught from the (US) Fed pushing rates higher and the Biden administration getting increasingly creative on the political and fiscal front to tame the energy inflation beast,” said Stephen Innes, managing partner at SPI Asset Management.

Seven oil corporations are scheduled to meet with Vice President Joe Biden on Thursday, under pressure from the White House to lower fuel costs as they post record profits. On Tuesday, however, Chevron CEO Michael Wirth stated that criticizing the oil business was not the way to lower petrol prices.

“These measures are not helpful in solving the difficulties we face,” Wirth wrote in a letter to Biden, prompting Biden to respond that the industry was being overly sensitive. Despite inflation concerns, demand is projected to rise to pre-COVID levels, and supply is expected to trail demand growth, keeping the market tight, as trading giant Vitol and Exxon Mobil Corp pointed out this week.

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Stocks decline as Wall Street’s effort at a rally fails

As markets struggled to maintain a recovery from earlier in the day, stocks modestly declined on Wednesday in turbulent trading. Traders also considered remarks made by Federal Reserve Chair Jerome Powell, who reaffirmed the position of the central bank in battling inflation. In the last hour of trade, the Dow Jones Industrial Average fell 47.12 points, or 0.15 percent, to 30,483.13. To 3,759.89, the S&P 500 fell 0.13 percent. To 11,053.08, the NASDAQ Composite dropped 0.15 percent.

Stock prices have recently been affected by growing fears of a Wall Street slump. On Wednesday, Fed Chair Powell testified before Congress that the Fed has the “resolve” to rein in inflation, which has risen to 40-year highs. The Fed chairman told the Senate Banking Committee, “At the Fed, we realise the suffering high inflation is inflicting. “We are acting quickly to bring inflation back down because we are strongly committed to doing so.”

Until it sees “compelling evidence that inflation is heading down,” Powell continued, the Fed will maintain its current trajectory. He added that it has grown “much more difficult” to provide a smooth landing for the economy without one. The Federal Reserve increased interest rates by 0.75 percentage points last week and warned that a similar hike could occur again the following month. Investors were alarmed by the central bank’s previous week change to a more aggressive stance against inflation, fearing that it would prefer a recession to continued high inflation.

Jerome Powell has made it clearly apparent that the Fed will keep raising interest rates until inflation starts to decline because inflation is still the largest risk to financial assets. Robert Schein, chief investment officer at Blanke Schein Wealth Management, wrote that a sustained rally for risk assets is difficult to envision until that time. Till the Fed gives the go-ahead, “tight monetary conditions will continue to be a headwind for financial markets,” Schein said.

This week on Wall Street, anticipation of an impending recession grew. According to evidence showing that consumers are beginning to cut down on spending, Citigroup increased the likelihood of a worldwide recession to 50%. The cumulative probability of recession is now approaching 50%, according to a note from Citigroup. “The experience of history indicates that disinflation generally bears considerable costs for growth,” the paper stated.

According to Goldman Sachs, the risks are “greater and more front-loaded,” making a recession for the American economy more likely. The Fed will feel compelled to respond forcefully to high headline inflation and consumer inflation expectations if energy prices continue to rise, even if activity slows sharply, the firm said in a note to clients. “The main reasons are that our baseline growth path is now lower and that we are increasingly concerned.” In the meantime, UBS stated in a note to clients on Tuesday that while in its base scenario it does not anticipate a U.S. or global recession in 2022 or 2023, “it is obvious that the possibilities of a hard landing are rising.”

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Fears about economy is growing as Wall Street’s hiring frenzy eases

After a hiring frenzy last year, Wall Street is slowing down due to the growing uncertainty around the U.S. economic future and the ensuing decline in the financial markets. In 2021 and early this year, Wall Street firms, including banks like Citigroup Inc, JPMorgan Chase & Co, and Wells Fargo & Co, were obliged to pay more to attract and keep employees due to fierce hiring competition. The increase in bonuses was the biggest in 15 years.

However, hiring fever is waning, according to executives, recruitment experts, and recent data. According to Alan Johnson, managing director of compensation consultancy firm Johnson Associates, “by the end of 2021 it was white hot with unprecedented demand for employment and pay.” “It’s changing swiftly from extremely hot to normal, and by the end of the year it might even turn cold. Undoubtedly, a change is taking place.”

According to the most recent U.S. Bureau of Labor Statistics data, firms in the securities, commodity contracts, investments, funds, and trusts sector were still adding jobs, but the rate of growth was noticeably slower in May, adding only 1,200 positions as opposed to 4,600 in April. In contrast, the industry experienced its largest annual headcount growth since 2000 in 2021, when the monthly average was 3,400.

In light of the weakening global markets, some clients have paused some talent searches, according to Alberto Mirabal, senior vice president for investment banking at the recruitment firm GQR Global Markets. These clients want to “see how things shake out” before adding to their already sizable teams.

We’re observing a little slowness, he added. Some Wall Street firms are concerned about the possibility of a recession due to rising inflation that has been compounded by Russia’s invasion of Ukraine and subsequent interest rate increases. Layoffs are already happening in several areas of the banking sector, most notably the mortgage sector, which is especially vulnerable to interest rate increases that harm house sales.

According to Bloomberg, JPMorgan Chase & Co. is this week reassigning hundreds of workers from its home loan division and firing hundreds more. The industry is not yet experiencing widespread hiring freezes or layoffs, the recruiters claimed, although in general. In addition, some smaller companies, such as boutique investment bank Lazard, are trying to seize the opportunity presented by the evolving market to attract top personnel for themselves.

After 2021, which he described as being the most difficult in a decade for staff retention and remuneration, Lazard Chief Executive Kenneth Jacobs claimed that a hiring slowdown was assisting his company in attracting new talent. Jacobs stated last week at a Morgan Stanley conference that “the rivalry for talent is lessening.” “I believe we’ll try to profit from this.”

Equity capital markets have experienced the sharpest reduction in activity; according to Julian Bell is the managing director and head of the Americas for the Sheffield Haworth talent firm. Broker-dealers will suffer more than full-service banks as a result, according to this. According to him, brokers in the main equities capital markets sectors of healthcare/biotech and technology will suffer the most. Investment bankers are not worried about impending layoffs, despite the fact that hiring is decreasing and salary expectations have decreased following an extraordinarily robust payout in 2021.

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Gold prices increase as ban on new Russian imports

Gold prices rose on Monday as speculation grew that some Western countries could formally forbid the import of the metal from Russia in response to that country’s invasion of Ukraine. By 0231 GMT, spot gold increased 0.5 percent to $1,835.58 per ounce. At $1,836.30, U.S. gold futures were up 0.3 percent. The G-7’s import embargo on Russian gold appears to be giving early Asian markets some short-term assistance.

“However, in practise for the grouping, it is largely a rubber stamp exercise, and I do not expect this to reflect a structural change in the supply/demand outlook that will underpin pricing.” In an effort to put more pressure on Moscow and eliminate its sources of funding for the invasion of Ukraine, four of the wealthy Group of Seven (G-7) countries decided to outlaw the import of Russian gold on Sunday. According to Stephen Innes, managing partner at SPI Asset Management, “the headline will be rapidly absorbed, and the market should return to its tug of war between higher front-end rates, negative for gold, and recession odds suggesting sooner rate reduction, positive for gold.”

Even as markets hailed economic data showing inflation expectations to be less worrying than initially thought, a couple of U.S. central bankers indicated on Friday they favoured future strong rate hikes to curb rapid price increases. Although gold is regarded as an inflation hedge, owning bullion, which pays no interest, has a higher opportunity cost as interest rates rise. Overall, gold is still stuck in the $1,780-$1,880 range that has been in place since early May. To change this dynamic, Halley added, the U.S. dollar must make a significant directional shift.

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UAE claims it has no spare capacity, oil prices jump by 1%

The energy minister of the United Arab Emirates stated that the country is producing near capacity, defying expectations that this could assist boost supply in a tight market. As a result, oil prices increased by nearly 1% in early Asian trade on Tuesday. According to some estimates, Saudi Arabia and the United Arab Emirates are the only two OPEC members with extra capacity to make up for lost Russian supplies and subpar performance from other members.

At 00:28 GMT, US West Texas Intermediate (WTI) crude CLc1 futures increased $1.07, or 1%, to $110.64 a barrel, building on a prior session rise of 1.8 percent. The price of Brent oil LCOc1 futures increased $1.08, or 0.9 percent, to $116.17 a barrel, following a prior session increase of 1.7 percent.

“The market was helped by rumours of a seam of restricted supply. According to reports, the capacity limits for two key producers, Saudi Arabia and the UAE, are being reached or will soon be reached “Tobin Gorey, a commodities analyst at Commonwealth Bank, stated in a note. According to its quota of 3.168 million barrels per day (bpd) under the deal with OPEC and its allies, collectively known as OPEC+, the UAE’s energy minister Suhail al-Mazrouei stated on Monday that the country was producing at or close to its full capacity.

His statements corroborated those of French President Emmanuel Macron, who told US President Joe Biden outside the Group of Seven meeting that Saudi Arabia could only increase output by 150,000 bpd, well below its nominal spare capacity of about 2 million bpd, and that the UAE was operating at maximum capacity. Analysts also noted that political upheaval in Libya and Ecuador could further constrain supply. Libya’s National Oil Corp said on Monday that if oil terminal production and shipping don’t pick up within the next three days, it may be necessary to declare force majeure in the Gulf of Sirte region.

According to Ecuador’s Energy Ministry, due to anti-government demonstrations, the nation may fully halt oil production over the next two days. Before the demonstrations, the former OPEC nation was producing about 520,000 barrels per day.

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Over the past 24 hours, crude oil prices increased while gold prices decreased

Over the past 24 hours, gold prices have been trending marginally lower as crude oil prices managed to end the day positively. An increase in the US dollar, which resulted from risk aversion as the tech-heavy Nasdaq 100 fell more than 3 percent, put pressure on the anti-fiat yellow metal. For gold, it might have been a lot worse. The flight to safety caused Treasury yields to decline, which increased the appeal of XAU/USD.

In June, the US Conference Board’s consumer confidence index fell to 98.7 from 100 expected. This represents a decline from 103.2 in May and a 16-month low. Concerns about inflation keep eroding Americans’ perceptions of the economy. Although respondents appeared to be planning to buy more durable products in the future, their desire for leisure (travel) fell with rising prices.

Despite the deteriorating mood, the price of crude oil managed to hold steady. An OPEC+ delegate reported that the oil-producing coalition fell 2.7 million barrels per day short of its output goal in May. This might be restricting supplies and giving WTI an upward push. However, rising concerns about a slowdown in global growth have made the situation for energy prices more difficult.

Commodities will be watching a flood of central bank speech during the next 24 hours. At the ECB forum in Sintra, a panel discussion will take place. Fed Chair Jerome Powell and ECB President Christine Lagarde are scheduled to speak. Market mood may suffer if authorities restate their hawkish viewpoints, thereby depressing the price of gold and crude oil.

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U.S. stocks failed to change much as the quarter end approaches

As investors analyzed remarks made by central bankers at a panel in Europe and anticipated more quarterly profit reports, U.S. stocks ended the day with no movement. On Wednesday, the Dow Jones Industrial Average rose 82.32 points, or 0.3%, to 31029.31. The NASDAQ Composite Index dropped 3.65 points, or 0.03 percent, to 11177.89, while the S&P 500 dropped 2.72 points, or less than 0.1 percent, to 3818.83.

The market is having a brutal first half after three years in a row of double-digit increases. The S&P 500 has lost roughly 20 percent of its value so far this year, making it likely that this will be its worst first half in fifty years.

Rising interest rates and sluggish growth are two factors that have a negative impact on stock prices. Stocks have also been affected by the swift return of inflation, a faltering Chinese economy, and a conflict in Ukraine that startled the commodity markets. Before the second half of the year begins on Friday, investors need to reorganise, according to State Street managing director Michael Arone. As the Fourth of July and the first half came to an end, he added, “We’re limping.”

Investors should take comfort in the fact that a poor first half does not imply a poor second half. The S&P 500 experienced a first-half decline of 21% and a second-half gain of 27% in 1970, concluding the year approximately level. As a result of a number of data releases showing that increased prices are dampening consumer optimism, stocks started the week on a low note. Investors continued to worry that if central banks tightened policy too quickly to combat inflation, it may trigger a recession.

At the European Central Bank’s annual economic policy conference in Portugal, Federal Reserve Chairman Jerome Powell said the epidemic had disturbed the economy in ways that could continue to generate more inflation or volatility in pricing pressures than previously. Is there a chance that we might go too far? There is unquestionably a risk, Mr. Powell remarked on Wednesday. “Failing to restore pricing stability would be the worse mistake to make, to put it that way,”

Some investors are losing faith in the Fed’s ability to arrange a “soft landing,” in which interest rates increase to combat inflation without causing the economy to enter a recession. “Until we have a strong indication that inflation has peaked, we anticipate markets will at best remain stable. Our belief in a soft landing has diminished even further, and the market is moving in that direction as well, according to Pictet Asset Management multiasset strategist Arun Sai.

After three straight days of advances, the yield on the benchmark 10-year Treasury note decreased to 3.091% from 3.206 percent on Tuesday. Prices increase as yields decrease. Investors are anticipating more corporate profit reports as the second quarter draws to a close. Even though FactSet projects a relatively small 5.8 percent increase in S&P 500 company earnings, early misses raise doubts about that estimate.

The market has been rattled by some earnings reports, according to Andrew Slimmon, a portfolio manager at Morgan Stanley Investment Management. “I assumed we’d see a rally into month-end,” he said. Bed Bath & Beyond, a retailer, provided an example of the point on Wednesday. After the company reported a larger quarterly loss than Wall Street anticipated and announced the departure of its chief executive, the shares dropped $1.54, or 24 percent, to $4.99.

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