Support
Earnings season wrap-up, markets in waiting mode
Markets are closely watching upcoming US GDP and Personal Consumption Expenditures (PCE) Price Index reports
The AUD/USD pair reached new seven-month highs
Gold prices fell in early European trading
WTI crude oil prices declined by 0.35%
Global markets exhibited mixed volatility yesterday, reflecting ongoing concerns and varying economic signals. Investors are navigating through a period of uncertainty, waiting for more clarity on the economic outlook.
Australia
Australia's Consumer Price Index (CPI) for July came in at 3.5% year-over-year, slightly higher than the forecasted 3.4% but lower than the previous 3.8%. The construction sector's quarterly growth was a modest 0.1%, falling short of the anticipated 0.7% and a stark contrast to the -2.9% from the previous quarter. Despite these mixed figures, expectations for further interest rate hikes by the Reserve Bank of Australia (RBA) are boosting the Australian Dollar (AUD).
AUD/USD
The AUD/USD pair renewed its seven-month highs above 0.6800 following the Australian CPI data. Despite a brief retracement, the pair remains near 0.6800 in Asian trading.
United States
In the US, the Consumer Confidence Index rose to 103.3 in August, up from a revised 101.9 in July. However, rising unemployment, now at a nearly three-year high of 4.3%, is casting a shadow over consumer optimism. This combination has left investors in a cautious "waiting phase" as they anticipate further economic signals.
Commodities
Gold prices saw a decline in early European trading on Wednesday, impacted by a modest rebound in the US Dollar (USD). Despite a dovish stance from the Federal Reserve and Jerome Powell's recent hints at possible interest rate cuts, gold's momentum remains subdued. Traders are closely watching upcoming speeches from Fed officials Christopher Waller and Raphael Bostic, along with forthcoming data on US GDP and Personal Consumption Expenditures (PCE) Price Index, which could influence the gold market.
Oil
West Texas Intermediate (WTI) crude oil prices fell by 0.35% in early European trading. This decline is attributed to slower economic growth in the US and China, which might reduce demand for oil. However, potential disruptions in Libya's oil production and persistent geopolitical tensions in the Middle East are expected to provide some support for oil prices, limiting further losses.
