January 07, 2022
EUR/USD: The major currency pair showed a bearish dynamic as the Wednesday’s US session ends, while market mood worsened as the US equity markets indices closed in the negative zone with losses, favoring the greenback’s traders. Yesterday EUR/USD pair was barely trading flat during the day, despite it lost some Wednesday gains, as traders estimated last FOMC’s meeting minutes. Moreover, Fed members began discussions of a contraction of its balance sheet, which market participants determine as a hawkish signal with investors selling stocks aggressively. Fed funds futures have shown an 80% chance of a rate hike in the 2022 March meeting.
NZD/USD: Kiwi is trading bearish near 0.6750 during Friday morning in Asia, keeping the immediate range after renewing a two-week low the previous day. NZD/USD pair’s latest inactivity could be linked to the typical pre-NFP cautious and a light calendar in Asia-Pacific while the Fed policymakers’ comments and the FOMC Minutes affected the previous fall as well as South African Omicron did. Talking about the macroeconomic data, US Factory Orders, Weekly Jobless Claims, ISM Services PMI and Good Trade Balance came bearish but couldn’t stop the US dollar bulls which were supported by the news about the faster Fed rate hike.
Gold: Yellow metal is trying to recover near $1.790 level while going to show the first weekly fall for the last 4 weeks during Friday’s session. Gold is trading around a 12-day low amid the market’s cautious mood ahead of the US jobs report for December. Despite this, sellers remain hopeful on the recent hawkish signs from the US Federal Reserve. The yellow metal pulled back from its local highs at $1.830 and has already reached the multi-day low due to Fed announcement which offered to rate hikes sooner than expected. Looking forward, market concerns of Omicron can entertain the gold bears, but the December month jobs report from the US will be more closely to watch by traders. Forecasts suggest the Nonfarm Payrolls rise from 210K to 400K while the Unemployment Rate may have fell to 4.1%.