Daily Market Bulletin – 07 January 2022

Market Developments

Fed of St. Louis president, mr Bullard (hawk and voter this year) pressed on overnight, following Wednesday hawkish minutes by the US central bank, which had spooked stock markets and mostly the tech sector.

He sees rate hikes as early as March and also commented that "the FOMC could also elect to allow passive balance sheet runoff in order to reduce monetary accommodation at an appropriate pace". [1]

Omicron remains in the spotlight, with WHO Director General Dr Tedros warning yesterday: "While Omicron does appear to be less severe compared to Delta, especially in those vaccinated, it does not mean it should be categorized as 'mild'. Just like previous variants; Omicron is hospitalizing people and it is killing people." [2]

Today, Australia's most populous state - New South Wales - announced new Covid-19 measures, ahead of an anticipated peak in cases later this month. [3]

Main Asia-Pacific stock markets were mostly upbeat, European futures appear subdued and US 10YR Yields back-off.

The US Dollar consolidates following yesterday's rise and Antipodeans (AUD, NZD) try to find some support against it.

Instruments Snapshot

EUR/USD lacks firm direction around 1.1300.

GBP/USD finds support after yesterday's drop, but fails to surpass 1.3550.

USD/JPY trades with positive undertone, off Tuesday's multi-year highs (116.35).

USD/CAD stays on the back foot, but defends 1.2700.

AUD/USD tries to halt its two-day slump above 0.7150.

NZD/USD takes a breath today and reclaims 0.6750.

GER30 trades with caution, trying to hold 16,000.

US30 steadies around 36,300.

USOIL extends gains past $80/barrel.

XAU/USD is mixed above yesterday's January lows (1,786).

Economic Calendar Picks (GMT)

US Jobs Report dominates today's economic calendar (13:30), with the economy forecasted to have added 400K jobs in December, following November's disappointing figures.

Canada releases its employment figures at the same time, while earlier in the day, we expect Eurozone's preliminary CPI Inflation and Retail Sales (10:00).

See the economic calendar here.

Nikos Tzabouras

Senior Market Specialist

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 07 Jan 2022 https://www.stlouisfed.org/news-releases/2022/01/06/bullard-discusses-initial-response-inflation-shock

2

Retrieved 07 Jan 2022 https://mobile.twitter.com/WHO/status/1479167003109859328

3

Retrieved 24 May 2022 https://www.nsw.gov.au/media-releases/support-measures-for-hospitals-community

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