US Session Recap
The US Unemployment Claims data might be overshadowed by the European Central Bank (ECB) monetary policy decisions. Nevertheless, it is anticipated that news related to the banking sector crisis will be the primary factor driving the Euro’s ongoing recovery against the US Dollar. In such a scenario, developments in the banking sector crisis could have a more significant impact on the EUR/USD exchange rate than the unemployment claims data or the ECB’s policy decisions.
Impact on Asian Session
Bank of England (BoE) officials have engaged in discussions with international counterparts regarding the potential global impact of the Credit Suisse crisis, anticipating the possibility of a bailout to prevent far-reaching consequences.
On the data front, the Australian employment figures exceeded expectations, with a net gain of 64.6K jobs (compared to the forecast of 49.7K and the previous month’s loss of 10.9K jobs). Additionally, the unemployment rate dropped to 3.5%, lower than both the forecast of 3.6% and the previous rate of 3.7%. These positive developments in the Australian labor market are likely to have a favorable impact on the Australian Dollar (AUD).
US Dollar (DXY)
Key News Events
Unemployment Claims
DXY Outlook for today
The projected number of Unemployment Claims for the period is 205K, which is slightly lower than the previous week’s figure of 211K. If the forecast proves accurate, the US Dollar may strengthen due to improved labor market conditions.
Central Bank Notes:
- The Committee has raised the federal funds rate target range to 4.5-4.75% and intends to continue increasing it in order to return inflation to 2%.
- The Committee will monitor incoming information and adjust the stance of monetary policy as appropriate to achieve its objectives.
- A majority vote from the Committee supported the decision to raise the target range.
- The next meeting is scheduled for 23 March 2023.
Next 24 Hours Bias
Weak Bullish
Australian Dollar (AUD)
Key News Events
No key news events
AUD Outlook today
There are no significant news events scheduled for the Australian Dollar (AUD) today, so its price direction will likely be influenced by previously released data. Westpac Consumer Sentiment remains unchanged at 0.0%, while the National Australia Bank (NAB) Business Confidence index has fallen to -4. This decline suggests a reduced confidence in the economy, which could potentially have a negative impact on the demand for AUD.
Central Bank Notes:
- The cash rate has been increased by 25 basis points to 3.60%.
- The Board’s primary focus is to bring inflation back to the target range, which may necessitate further tightening of monetary policy.
- The Board will carefully monitor the global economy, household spending trends, inflation, and labor market outlook when assessing the need for interest rate increases.
- The next meeting is set for April 4, 2023.
Next 24 Hours Bias
Weak Bearish
The Kiwi Dollar (NZD):
Key News Events
No key news events
NZD Outlook today
The New Zealand Dollar (NZD) experienced a current account balance of -9.46 billion, which was worse than the predicted -7.64 billion but better than the previous -10.21 billion. The ongoing negative balance implies a weaker economic performance, which may contribute to a depreciation in the NZD’s value.
Central Bank Notes:
- The Monetary Policy Committee has raised the Official Cash Rate (OCR) from 4.25% to 4.75%.
- Higher interest rates are necessary to curb inflation and sustainably support employment.
- The severe storms in the North Island are expected to increase inflation and disrupt production.
- The next meeting is scheduled for April 5, 2023.
Next 24 Hours Bias
Weak Bearish
The Japanese Yen (JPY):
Key News Events
No key news events
JPY Outlook today
The Bank of Japan (BoJ) has confirmed that it will maintain its ultra-accommodative policy stance and continue implementing quantitative easing measures to achieve its 2% inflation target. This decision was anticipated and aims to promote economic stability.
Central Bank Notes:
- The BoJ will persist with Quantitative and Qualitative Monetary Easing (QQE) with Yield Curve Control in order to attain the price stability target of 2%.
- Japan’s economy is projected to recover gradually.
- The central bank is prepared to implement additional easing measures if needed to support the economy.
- The next meeting is scheduled for April 27, 2023.
Next 24 hours bias
Weak Bearish
The Euro (EUR):
Key News Events
No key news events
EUR Outlook today
Positive German Wholesale Price Index (WPI) (forecasted at 0.3%, compared to the previous 0.2%) and Industrial Production data (expected at 0.3%, up from the previous -1.1%) may provide a boost to the Euro. Additionally, a decrease in the Italian Quarterly Unemployment Rate (forecasted at 7.8%, down from the previous 7.9%) could offer support to the currency. On the other hand, the French Final Consumer Price Index (CPI) (expected at 0.9%, unchanged from the previous reading) is unlikely to have a significant effect on the Euro.
Central Bank Notes:
- The Main Refinancing Rate is currently set at 3.00%.
- The European Central Bank (ECB) Governing Council intends to continue raising interest rates and reducing holdings of securities to manage inflation.
- Future policy decisions will be dependent on incoming economic data.
- The next meeting is scheduled for March 16, 2023.
Next 24 hours bias
Weak Bullish
The Swiss Franc (CHF):
Key News Events
No key news events
CHF Outlook today
There are no significant news events scheduled to influence the Swiss Franc (CHF) today. The currency’s price direction bias may be shaped by the previously released month-to-month Producer Price Index (PPI) data, which showed a negative reading of -0.2% (compared to the expected 0.5% and the previous 0.7%).
Central Bank Notes:
- The current policy rate stands at 1.00%.
- The next meeting is set for March 23, 2023.
Next 24 hours bias
Weak Bearish
The Pound (GBP):
Key News Events
Annual Budget Release
GBP Outlook today
A favorable release in the UK’s Annual Budget Release, highlighting robust economic growth and fiscal discipline, can strengthen the British Pound (GBP). Conversely, an unfavorable release featuring increased taxes or reduced growth projections may lead to a depreciation in the GBP.
Central Bank Notes:
- The Monetary Policy Committee (MPC) voted to raise the Bank Rate by 0.5 percentage points to 4%.
- Near-term data developments are crucial for assessing the pace at which external and domestic inflationary pressures will subside.
- The MPC’s updated projections indicate that the Consumer Price Index (CPI) inflation will decline sharply from its current level.
- The next meeting is scheduled for March 23, 2023.
Next 24 hours bias
Mixed
The Canadian Dollar (CAD):
Key News Events
No major news events.
CAD Outlook today
Canadian Housing Starts are expected to rise from 215K to 222K, which could have a positive effect on the Canadian Dollar (CAD) due to the potential for job creation and economic growth.
Central Bank Notes:
- The Bank of Canada (BOC) has maintained its target for the overnight rate at 4.5%.
- Inflation slowed down in January, but price increases for food and shelter continue to be elevated.
- The BOC is ready to raise the policy rate further to bring inflation back to the 2% target.
- The next meeting is scheduled for April 12, 2023.
Next 24 hours bias
Weak Bullish
