Market sentiment remained mostly downbeat as investors processed the Fed's aggressive tightening path, persistent Russia-West tensions over Ukraine and mixed earnings.
The US Federal Reserve did not move on rates (0-0.25%), as it handed down its monetary policy on Wednesday. Mr Powell pointed to March lift-off and multiple hikes. The bank reaffirmed that asset purchases will end in early March, but did not say when it will begin reducing the balance sheet.
The Bank of Canada (BoC) refrained from pulling the trigger on rates on Wednesday, keeping them at 0.25%, while reduction of its balance sheet will be considered after it begins hiking rates.
Friday's data showed that the Fed's favorite measure of Inflation, the Core Personal Consumption Expenditures, rose 4.9% y/y in December, compared to 4.7% prior.
US Q4 advance annualized GDP grew 6.9%, from 2.3% prior, while Germany's stood at 1.4%, versus 2.9% prior (revised).
New Zealand CPI Inflation surged 5.9 y/y in Q4, from 4.9% y/y prior, reinforcing the case for further rate hike by the country's central bank, while Australian CPI rose 3.5% y/y in the same quarter, compared to 3% prior.
On Tuesday, the International Monetary Fund (IMF) downgraded its global growth forecast to 4.4% in 2022 from 4.9% in the October projections.
On the geopolitical front, fears of Russian invasion in Ukraine were high, with the US placing up to 8,500 troops on alert and calling for meeting of the United Nations Security Council.
The US Dollar got a boost from the Fed's aggressive tightening prospects, with Euro, GBP, AUD and NZD dropping to 2022 lows against it.
US indices were heading towards another negative and volatile week, as the Fed Put never came.
USOIL extended its gains into November 2014 territory and was heading for its sixth profitable week, whereas XAU/USD was on track for weekly losses.
This was a busy week as tech heavyweights reported their quarterly results, with Apple delivering record Revenues, Tesla saying it won't introduce new models this year and more.
Week Ahead (GMT)
Central banks will remain in the spotlight as the Bank of England meets on Thursday and could deliver another rate hike, following December's lift-off that had surprised many investors.
On the same day, the European Central Bank (ECB) also hands down its monetary policy decision, while the Reserve Bank of Australia (RBA) kicks things off on Tuesday. The RBA is not expected to change the interest rates, but markets will be waiting to see if it will reduce or end its asset purchases.
US Non-Farm Payrolls (NFPs) are due on Friday, following the disappointing addition of only 199K jobs in December, with Canada also releasing its Jobs report on the same day.
OPEC and its allies, group known as OPEC+, is expected to decide on its oil output plan on Tuesday.
From the rest of the next week's busy economic calendar, Eurozone Q4 GDP (Monday), Final PMIs from various economies (Tuesday & Thursday), New Zealand Q4 Employment figures (Tuesday), Eurozone's preliminary CPI Inflation (Wednesday), are some the releases that stand out.
China's stock markets will be closed on some days during next week, due to the Lunar New Year holiday.
On the earnings front, Ford, Alphabet (Google), Meta Platforms (Facebook) and Amazon are some of the biggest names reporting their financial results.
See the economic calendar here.
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.