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Currency Market Analysis
Currency Market Analysis
5/01/24
USD 🇺🇸
Strong NFP and Dollar repricing - Market adjusting expectations for Fed - Impact on interest
rate cuts
Federal Reserve’s policy and rate cuts - Focus on timing and magnitude of rate cuts -
Influence on employment, inflation and economic growth
Key indicators to watch - Unemployment rates - Participation rates, core inflation data -
Business activities (PMIs)
Short term Dollar strength with caveat - Potential for continued strength - influence on longer
term narrative and market pricing
GBP 🇬🇧
Recent Economic data and outlook - Strong services PMI growth - Concerns about wage
pressures and staffing - Steady unemployment rate
Interest rate expectations and market reactions - Shift in market expectations for rate cuts -
GBP strengthening due to longer period of higher rates
PMI data and business confidence - Watching GDP data, retail sales and three month
average GDP
GBP trading strategy - Tactical approach in pairs like GBPAUD and GBPUSD (Hedging)
Key factors influencing the GBP - Unemployment data, wage inflation - Bank of England’s
interest rate decisions
EUR 🇪🇺
Recent inflation data - Weaker than expected - Potential ECB rate cuts
ECB interest rate expectations - Market expectations for rate cuts - Impact on short term
direction on EUR
Trading strategy - Bearish stance against stronger currencies - Tactical trading in pairs like
EURAUD
Overall market dynamics - Focus on central bank rate cuts - Influence on USD strength or
weakness
Conclusion - Complex outlook for EUR - Monitoring economic data for trading decisions
AUD 🇦🇺
Recent Economic Data - Muted data with global influence - Weakening against USD
Influence of the US dollar and Fed minutes - Stronger USD leading to AUD downward trend
CAD 🇨🇦
Recent Economic Data - Mixed labour market report - Stable unemployment rate with wage
growth
Interest rate expectations - Bank of Canada’s rate cut and hike possibilities
Oil prices and Geopolitical risk - Impact of oil prices and middle east tensions
NZD 🇳🇿
Lack of significant data - Slow week
Wage negotiations and inflation - Key factors for BOJ decision making