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America’s Roundup: Dollar dips after weak U.S. factory production data, Wall Street gains, Gold edges down, Oil prices pull back as U.S. factory data intensifies demand concerns-October 19th,2021

Posted at 19 October 2021 / Categories Market Roundups


Market Roundup

• Canada Sep Housing Starts  251.2K,255.0K forecast, 260.2K previous

• Canada August Foreign Securities Purchases   15.17B,14.19B previous

• French 12-Month BTF Auction -0.629%,-0.641% previous

• French 3-Month BTF Auction -0.732%,-0.740% previous

• French 6-Month BTF Auction -0.667%., -0.675% previous

• US Sep Industrial Production (MoM) -1.3%, 0.2% forecast, 0.4% previous

• US Sep Capacity Utilization Rate 75.2%, 76.5% forecast, 76.4% previous

• US Sep Manufacturing Production (MoM)  -0.7%,0.1% forecast, 0.2% previous

• US Sep Industrial Production (YoY)  4.60%, 5.95% previous

• US Oct NAHB Housing Market Index 80, 76 forecast, 76 previous

• US 3-Month Bill Auction 0.060%, 0.050% previous

• US 6-Month Bill Auction 0.055% ,0.055% previous

• US Federal Budget Balance -171.0B previous

Looking Ahead Economic Data (GMT)

•No data ahead

Looking Ahead - Events, Other Releases (GMT)

• 01:30 Australia RBA Meeting Minutes

Currency Summaris

EUR/USD: The euro strengthened on Monday as dollar dipped after data showed production at U.S. factories fell by the most in seven months in September, erasing earlier gains on expectations that the Federal Reserve may be closer to raising interest rates than previously expected.U.S. manufacturing output was hurt as an ongoing global shortage of semiconductors depressed motor vehicle output, providing further evidence that supply constraints were hampering economic growth. The euro rose 0.11% to $1.1610, after earlier dropping to $1.1570.   Immediate resistance can be seen at 1.1620 (20DMA), an upside break can trigger rise towards 1.1629(38.2%fib).On the downside, immediate support is seen at 1.1571(23.6%fib), a break below could take the pair towards 1.1500 (Psychological level).

GBP/USD: The British pound steadied against the dollar on Monday after Bank of England Governor Andrew Bailey sent a fresh signal that the central bank is gearing up to raise interest rates as inflation risks mount. During an online panel discussion on Sunday organised by the Group of 30 consultative group, Bailey said the BoE will “have to act” in its monetary policy meetings on the risk of medium term inflation.He continued to believe that the recent jump in inflation would be temporary, but that a surge in energy prices would push it higher and make its climb last longer. Investors were awaiting CPI September inflation data for Britain due on Wednesday. Immediate resistance can be seen at 1.3761(50%fib),an upside break can trigger rise towards 1.3848(61.8%fib).On the downside, immediate support is seen at 1.3678(38.2%fib), a break below could take the pair towards 1.3615(20DMA).

 USD/CAD: The Canadian dollar barely moved against its U.S. counterpart on Monday as oil prices rose and data showed slower economic growth in China, with the currency holding near a three-month high. World stock markets dipped after data showed slower-than-expected growth in China's economy last quarter, and surging prices for oil, one of Canada's major exports, fed inflation concerns. U.S. crude oil futures were up nearly 1% at $83.07 a barrel, buoyed by recovering demand and high natural gas and coal prices encouraging users to switch to fuel oil and diesel for power generation . Immediate resistance can be seen at 1.2387 (5DMA), an upside break can trigger rise towards 1.2440(38.2%fib).On the downside, immediate support is seen at 1.2341(23.6%fib), a break below could take the pair towards 1.2306 (Lower BB).

USD/JPY: The dollar retreated slightly against yen on Monday as an unexpected drop in U.S. industrial production tamed rising dollar. US September industrial and manufacturing output unexpectedly fell and August data was revised lower. Production at U.S. factories fell by the most in seven months in September as an ongoing global shortage of semiconductors depressed motor vehicle output, further evidence that supply constraints were hampering economic growth.The dollar fell 0.02% to 93.95 against a basket of currencies. It had earlier reached 94.17. Strong resistance can be seen at 114.55(23.6%fib), an upside break can trigger rise towards 115.00(Psychological level).On the downside, immediate support is seen at 113.95(38.2%fib), a break below could take the pair towards 113.50(50%fib).

Equities Recap

European shares declined  on Thursday after a sobering warning from the World Health Organization that the coronavirus may never go away and signals that top central banks may have hit the bottom with interest rates.

UK's benchmark FTSE 100 closed down by  0.42 percent, Germany's Dax ended down by 0.72 percent, France’s CAC finished the day down by 0.81 percent.                

U.S. stocks rose on Monday on gains in heavyweight technology companies, although sentiment remained fragile due to slowing economic growth in China and concerns of elevated inflation due to a relentless surge in oil prices.

Dow Jones closed down  by  0.10% percent, S&P 500 closed up by 0.34 % percent, Nasdaq settled up  by 0.84%  percent.

Treasuries Recap

Mid-term U.S. Treasury yields resumed their upward march on Monday with five-year yields rising to their highest levels since early 2020 as traders positioned for expected central bank rate hikes.

Yields on benchmark 10-year U.S. debt were up 2.6 basis points at 1.6019%.

Commodities Recap

Gold edged lower on Monday as a rise in U.S. Treasury yields dented its appeal, although a risk-off sentiment in wider financial markets limited losses for the metal.

Spot gold was down 0.1% at $1,765.14 per ounce by 1:35 p.m. EDT (1735 GMT), while U.S. gold futures settled down 0.2% at $1,765.70.

Oil prices pulled back after touching multi-year highs on Monday, trading mixed as U.S. industrial output for September fell, tempering early enthusiasm about demand.

U.S. West Texas Intermediate (WTI) crude settled 16 cents higher, or 0.19%, at $82.44 a barrel, after hitting $83.87, their highest since October 2014.


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