Macro Roundup (Nov 30)

Published: Nov 30, 2022 09:30
The greenback edged lower against the Japanese yen on Tuesday with Federal Reserve chairman Jerome Powell due to speak on Wednesday, while the Aussie dollar jumped as sentiment improved on hopes that China would reopen from COVID shutdowns.

SHANGHAI, Nov 30 —This is a roundup of global macroeconomic news last night and what is expected today.

The greenback edged lower against the Japanese yen on Tuesday with Federal Reserve chairman Jerome Powell due to speak on Wednesday, while the Aussie dollar jumped as sentiment improved on hopes that China would reopen from COVID shutdowns.

Powell’s comments will be evaluated for any new signs of hawkishness, with key jobs data for November due on Friday.

The dollar index has fallen to 106.82 from a 20-year high of 114.78 on Sept. 28 as investors look toward the U.S. central bank reaching a peak rate early next year with inflation pressures expected to subside.

The U.S. central bank is expected to hike rates by an additional 50 basis points when it meets on Dec. 13-14, though the odds of a 75-basis-point increase have risen over the past several weeks and now stand at a 37% probability.

Traders are pricing for the Fed funds rate to peak at 5.01% in June, before falling back to 4.64% by December 2023. The euro fell 0.15% against the U.S. currency to $1.0324. The greenback dipped 0.15% to 138.69 Japanese yen.

Stock futures were little changed Tuesday evening as Wall Street awaits a Wednesday speech from Federal Reserve Chair Jerome Powell that may give further insight into future rate hikes.

Futures tied to the Dow Jones Industrial Average fell 19 points, or 0.06%. S&P 500 futures and Nasdaq 100 futures slipped 0.09% and 0.17%, respectively.

The moves come after a mixed day for stocks. The Nasdaq Composite shed 0.59% and the S&P 500 lost 0.16%, their third negative days in a row. The Dow Jones Industrial Average notched a marginal gain, closing 3.07 points, or 0.01%, higher.

Stocks have been weighed down by China’s zero-Covid policy and have failed to fully recover from losses even as the country announced steps toward reopening, such as an uptick in vaccination rates for the elderly.

Oil rose on Tuesday on expectations for a loosening of China’s strict COVID-19 controls, but concerns that OPEC+ would keep its output unchanged at its upcoming meeting limited gains.

Brent crude futures settled at $83.03 a barrel, losing 16 cents, or 0.2%. U.S. West Texas Intermediate (WTI) crude futures settled at $78.20 a barrel, up 96 cents, or 1.2%.

Gold prices rose 1% on Tuesday, helped by a retreat in the dollar and hopes for less aggressive rate hikes from the U.S. Federal Reserve going forward.

Spot gold gained 0.6% to $1,751.21 per ounce by 2:02 p.m. ET, and U.S. gold futures settled 0.5% higher at $1,748.4.

The pan-European Stoxx 600 closed flat, down 0.1%, having given back earlier gains of more than 0.5%. Basic resources added 2.7% while chemicals stocks fell 1.7%.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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