Market Wrap and Next Week – Including March 11th
Recent comments from ECB President Christine Lagarde and Federal Reserve Chair Jerome Powell suggest that both central banks are considering starting a series of rate cuts in June.
Fed Chairman Jerome Powell suggested in testimony before the Senate Banking Committee on Thursday that interest rates could soon fall. “If the economy performs as expected, we believe we will cautiously begin to lift our restrictive policy stance later this year,” Powell said on Thursday.
Friday’s latest U.S. jobs report also showed that the closely watched unemployment rate unexpectedly rose to 3.9% from 3.7%, while average incomes slowed further.
USD weakens further following US NFP beat, but January numbers revised downwards
Also on Thursday, the ECB’s Lagarde pointed to the end of the second half of the year as the right time to start reducing borrowing costs in comments after the policy decision.
“We are on track to meet our inflation target and confidence is growing as a result…but we are not fully confident. Clearly we need more evidence and more data. . We’ll know a little more in April, but we’ll know even more in June.”
Earlier, ECB staff forecasts slashed inflation and growth expectations for the next three years.
Euro (EUR/USD) falls slightly, ECB leaves all policy rates unchanged
In Japan, recent comments from Bank of Japan officials indicate that if the current wage negotiations yield the expected results, the market has already priced in more than a 60% chance of a rate hike, and the Bank of Japan will begin raising rates soon. suggests that it is possible. this month.
Important economic announcements and events – including March 11th.
There are several important data releases that could bring further volatility to various asset classes. Next week’s highlight will be the latest US inflation report, followed by UK jobs and growth data.
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Gold, Nasdaq 100, Nvidia
Gold prices continued to rise this week, hitting several all-time highs. Precious metals prices are higher than ever due to a combination of rising interest rate cut expectations, Chinese demand and safe-haven buying.
gold daily price chart
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U.S. indexes rose modestly for the week, but Friday’s drop, which was noticeable in the Nasdaq, was notable. Although Friday’s decline was damaging, the Nasdaq index remains bullish, having continued to make lower lows and higher highs for the past five consecutive months.
Nasdaq 100 day chart
One company that bucked recent bullish trends was Nvidia, which fell sharply on Friday. Semiconductor giant Nvidia is one of the largest publicly traded companies and has a large influence on various U.S. indexes. It will be worth following Nvidia next week to see if Friday’s move was an anomaly.
Nvidia daily chart
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Technical and fundamental forecasts – including March 11th
British pound weekly forecast: GBPUSD looks overextended at 7-month high
The pound is expected to start the new trading week at its highest level in more than seven months against the dollar, having fallen sharply on expectations that a rate cut is certain.
Euro Weekly Forecast: Earnings look fragile in the coming week
This article explores the fundamental and technical outlook for the euro and considers the pivotal factors that could influence price movements over the next week.
Gold price outlook – Expected to continue rising on the back of US interest rate cuts
Gold’s recent record rally looks likely to continue as US interest rate cuts are expected to begin at the end of the first half.
USD Forecast: US CPI will trigger the next big move – EUR/USD, USD/JPY, GBP/USD
February’s US inflation data is expected to ignite heightened market volatility next week and play a pivotal role in shaping the dollar’s near-term outlook.
All articles are written by DailyFX analysts and strategists