Week was dominated by major Global Central banks rate decisions and statements. USD whipsawed after announcements. USD fell soon after Fed decision, but rebounded on Friday evening as NY Fed President quashed market expectations of March 2024 rate cuts.<\/span><\/b><\/p>\r\nFed has removed rate hike scenario and has signaled that rate has peaked at 5.25-5.5% band. It is also now projecting three rate cuts next year, to 4.6%. This is against two rate cuts projected last time. Fed Chairman said that it is too premature to declare victory against inflation. However, he did not aggressively push back against rate cuts next year. As per Fed, Core PCE is expected to soften to 3.2% this year as against earlier projection of 3.7% and is further expected to drop to 2.4% next year. Unemployment is expected to be 4.1% for next year. GDP is expected to be 2.6% in this year and expected to soften to 1.4% next year.<\/span><\/b><\/p>\r\nNY Fed President quashed hopes of March 2024 rate cut. He emphasized Fed\u2019s focus on determining if the current monetary policy is \u201csufficiently restrictive\u201d to bring inflation back down to the 2% target. He also highlighted the unpredictable nature of economic data, suggesting Fed must be prepared to \u201ctighten the policy further, if the progress of inflation were to stall or reverse.\u201d<\/span><\/b><\/p>\r\nUS 10 year yield declined to 3.95%. In mid Oct, it was above 5%. Market enthusiasm towards rate cut seems to be much ahead of the curve as US spending, labor market and services data are still strong. US Equities and Global Equities surged on the above developments.<\/span><\/b><\/p>\r\nBoE kept Bank Rate unchanged at 5.25%.BOE reiterated its stance that “monetary policy is likely to be restrictive for an extended period of time.” This suggests continued cautious approach towards easing monetary conditions, likely due to persistent inflationary pressures. The Bank further emphasized that “Further tightening in monetary policy would be required if there were evidence of more persistent inflationary pressures,” indicating readiness to adjust policy should inflation not moderate as expected.<\/span><\/b><\/p>\r\nECB kept interest rates unchanged, maintaining the main refinancing rate at 4.50% and the deposit rate at 4.00%, as was widely anticipated. In a significant update, ECB substantially lowered its headline inflation forecast for 2024 from 3.2% to 2.7%.\u00a0On the growth front, ECB\u2019s projections indicate modest economic performance, with growth averaging 0.6% for 2023, 0.8% for 2024.<\/span><\/b>\u00a0<\/span>ECB<\/span><\/b>\u00a0<\/span>reiterated that the current interest rates are positioned to substantially contribute to bringing inflation back to its target, provided they are \u201cmaintained for a sufficiently long duration.\u201d The ECB plans to continue following a \u201cdata-dependent approach\u201d to determine the \u201clevel and duration\u201d of policy restrictions.<\/span><\/b><\/p>\r\nECB President in her post-meeting press conference, made it clear that the governing council did not discuss a rate cut in their meeting. She underlined the ECB\u2019s vigilance, asserting the need to \u201ckeep our guard up\u201d and closely monitor data to ascertain if the recent decline in inflation is sustainable.<\/span><\/b><\/p>\r\nECB member said that rate hikes are over, but it is too premature to talk about rate cuts.<\/span><\/b><\/p>\r\nEU PMI Composite index decreased from 47.6 to 47.0.<\/span><\/b>\u00a0<\/span>This ongoing contraction underscores the challenges facing the Eurozone economy, with a high likelihood that it has been in a recession since the third quarter.<\/span><\/b><\/p>\r\nUK PMI(composite) rose to 51.7 from 50.7, 6 months high.<\/span><\/b>\u00a0<\/span>Chief Business Economist at S&P Global Market Intelligence, commented, \u201cThe UK economy continues to dodge recession, with growth picking up some momentum at the end of the year to suggest that GDP stagnated over the fourth quarter as a whole.\u201d<\/span><\/b>\u00a0<\/span>He<\/span><\/b>\u00a0<\/span>also highlighted the dual-speed nature of the UK economy, with manufacturing contracting sharply while services, particularly financial services, showed signs of growth.<\/span><\/b><\/p>\r\nBased on the vacillating comments from Fed, ECB and BOE members, expect Cross Currency consolidation to happen with no two way clear movement till the path of rate differential becomes more certain.<\/span><\/b><\/p>\r\nCurrency technical levels<\/b>: USDINR: 82.80\/82.65 (Supports), 83.25\/83.40 (resistance),<\/b><\/b><\/p>\r\n
EURINR:91.80(Resistance),89.50\/88.75(Support),<\/b><\/p>\r\n
GBPINR: Supports: 104.20\/103.40( supports), Resistance:106.50(Resistance).<\/b><\/p>\r\n
JPYINR: Resistance:59, Supports: 57.45\/56.45 (support).<\/b><\/p>\r\n
Hedging advise<\/b>: USDINR imports be hedged on decline to 82.80\/82.60. EUR and GBP exports can be covered.<\/b><\/p>\r\nClick to open an Account<\/strong>\u00a0:\u00a0https:\/\/ekyc.gwcindia.in\/client\/<\/a><\/div>\r\nFor all your investment needs feel free to reach us.<\/strong>\r\n\r\n
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Give us Missed Call us on 90037 90027 . For Support : 044-40329999<\/strong><\/div>\r\n<\/div>\r\n<\/div>","protected":false},"excerpt":{"rendered":"FX Weekly Currency Score Week 51 of 2023 WEEKLY SYNOPSIS: 15\/12\/2023 Currency Map: Currency Pairs WEEK CLOSE PRIOR WEEK CLOSE % change USD\/INR 83.02 83.38 \u00a0-0.42 EUR\/INR 91.36 89.89 1.63 GBP\/INR 106.12 104.91 1.15 JPY\/INR 58.60 57.88 1.24 Brent Crude closed at USD 77 VS prior week close of USD 75.50. Gold closed at USD […]<\/p>\n","protected":false},"author":6,"featured_media":3180,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"image","meta":{"_acf_changed":false,"footnotes":""},"categories":[36],"tags":[],"class_list":["post-5017","post","type-post","status-publish","format-image","has-post-thumbnail","hentry","category-currency-update","post_format-post-format-image"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/posts\/5017","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/comments?post=5017"}],"version-history":[{"count":3,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/posts\/5017\/revisions"}],"predecessor-version":[{"id":8780,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/posts\/5017\/revisions\/8780"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/media\/3180"}],"wp:attachment":[{"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/media?parent=5017"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/categories?post=5017"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gwcindia.in\/blog\/wp-json\/wp\/v2\/tags?post=5017"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}