Asia Fundamental Forecast: 20 October 2023

Asia Market 20 October 2023 The impact of recent US economic events on Asian markets. Currency trends and central bank actions.

After a robust three-week uptrend, US unemployment claims fell to 198k, below the forecasted 210k, boosting the US dollar. Federal Reserve Chairman Jerome Powell’s neutral stance hinted at steady interest rates, affirming expectations of no change in the upcoming meeting. The Dollar Index (DXY) initially dropped to 106.00 but recovered to 106.20 by the US session close.

Asia Fundamental Forecast – 20 October 2023

During the Asian session, the DXY rose, aiming for 106.50. Without major events, currencies like the AUD and NZD showed mixed trends. The RBNZ’s statement of intent awaited, potentially influencing the Kiwi’s direction. Japan’s weak inflation maintained the Bank of Japan’s dovish stance, keeping USD/JPY elevated.

Currency Trends

Gold (XAU): Gold prices could rise if the US dollar weakens during Harker’s speech.

Next 24 Hours Bias: Medium Bullish

Australian Dollar (AUD): The AUD recovered and is rising towards 0.6330; analysts expect further gains.

Next 24 Hours Bias: Weak, Bullish

New Zealand Dollar (NZD): RBNZ’s statement of intent might lift NZD; watch for a hawkish tone.

Next 24 Hours Bias: Weak, Bullish

Japanese Yen (JPY): Weak inflation sustains the Bank of Japan’s dovish stance, possibly keeping the USD/JPY high.

Next 24 Hours Bias: Weak, Bullish

Euro (EUR): PPI data may pressure Euro if disinflationary momentum continues.

Next 24 Hours Bias: Weak, Bullish

Swiss Franc (CHF): USD/CHF likely to decline after initial rebound, influenced by Powell’s speech.

Next 24 Hours Bias: Medium Bearish

British Pound (GBP): Mixed retail sales data might impact GBP negatively.

Next 24 Hours Bias: Weak, Bullish

Canadian Dollar (CAD): Possible USD/CAD rise if final retail sales data confirms the preliminary estimate.

Next 24 Hours Bias: Weak, Bullish

Oil: Rising crude prices driven by the Fed’s likely rate hold and Middle East tensions.

Next 24 Hours Bias: Medium Bullish

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