Europe roundup: Euro set for biggest 3-day drop in 2 years as oil prices soar, European stocks fall, gold tests $2,000 mark, oil soars, Brent briefly tops $139 a barrel – March 7, 2022
• German Factory Orders in January (MoM) 1.8%, forecast 1.0%, previous 2.8%
• UK Feb Halifax House Price Index (MoM) 0.5%, previous 0.3%
• German Retail Sales in January (YY) 10.3%, forecast 9.8%, previous 0.0%
• French February Reserve Assets Total 232,616.0M ,224,650.0M previous
• Sentix March EU Investor Confidence -7.0, 5.3 forecast, 16.6 previous
Forward-looking economic data
•2:00 p.m. French 3-month BTF auction -0.745% previous
• 2:00 p.m. French 6-month BTF auction -0.702% previous
•14:00 BTF auction 12 months French -0.605% previous
•15:00 United States Feb CB Employment Trends Index 117.62 previous
•16:30 US 6-Month Bill Auction 0.670% previous
•20:00 US Jan Consumer Credit 23.80B forecast, 18.90B previous
Future Outlook – Events, Other Releases (GMT)
• No upcoming events
EUR/USD: The euro fell more than 1% against the dollar on Monday and was on course for its biggest three-day loss in two years as soaring oil prices stoked fears of a stagflationary shock which could hammer the hopes of recovery in Europe. more vulnerable as it imports up to 40% of its natural gas from Russia and the single currency has become increasingly correlated with oil prices the higher oil rises the lower the euro as investors worry about rising inflation and the blow to the economy. The Euro fell more than 1% to $1.0806, a May 2020 low. Immediate resistance can be seen at 1.0921 (38.2% fib), an upside break can trigger a rise towards 1, 1002 (50% fib). On the downside, immediate support is seen at 1.0875 (BB lower), a break below could take the pair towards 1.0802 (23.6% fiber).
GBP/USD: The pound fell against the dollar on Monday as another volatile session pushed investors to buy dollars. European currencies have been falling rapidly since Russia invaded Ukraine as investors worry about the impact on their economies from the war and soaring commodity prices. While the UK economy is not as exposed as eurozone economies, the pound suffered against the dollar but gained against a falling euro against almost all currencies. The pound fell 0.4% to $1.3183, after weakening to $1.3157, its lowest since December 2020. Immediate resistance can be seen at 1.3220 (38.2% fib) , an upside break may trigger a rise towards 1.3284 (50% fib). On the downside, immediate support is seen at 1.3163 (BB lower), a break below could take the pair towards 1.3144 (23.6% fib).
USD/CHF: The dollar rose against the Swiss franc on Monday as concerns over the impact of the Ukraine-Russia conflict on inflation and a global economic recovery boosted demand for the greenback. Fighting in Ukraine intensified over the weekend and attempts at a ceasefire to allow civilians to evacuate the besieged city of Mariupol appear to have so far failed. Reserve and other central banks to rapidly tighten monetary policy, just as the world emerges from its pandemic crisis. Immediate resistance can be seen at 0.9251 (38.2% fib), a break up can trigger a rise towards 0.9286 (23.6% fib). On the downside, immediate support is seen at 0.9220 (50% fib), a break below could take the pair towards 0.9192 (61.8% fib).
USD/JPY: The dollar strengthened against the yen on Monday as investors rushed into the dollar as the Russia-Ukraine crisis deepened. As the conflict enters its 12th day, Ukraine is preparing to ask the highest court of the United Nations today to intervene to end the invasion of Moscow. Russian President Vladimir Putin has said his campaign in Ukraine will not end until Kiev stops fighting. The dollar was also partly supported by a strong payrolls report which only reaffirmed market expectations for a Fed hike this month. The dollar last traded up 0.44% against the Japanese yen at 115.23. 115.10(38.2%fib), a break below could take the pair towards 114.69(50%fib).
Summary of actions
European stocks hit their lowest level in a year on Monday in light of a possible Western ban on Russian oil.
At (GMT 1:20 p.m.), Britain’s benchmark FTSE 100 last traded at 0.29%, Germany’s Dax was down 0.89%, France’s CAC ended down 0.65 %.
Summary of raw materials
The price of gold hit $2,000 for the first time in a year and a half as investors rush to the safe-haven metal as the Russia-Ukraine crisis worsens amid fears of supply disruptions. propelled palladium to an all-time high on Monday.
Spot gold rose 1.1% to $1,990.20 an ounce at 07:51 GMT, after hitting its highest level since August 19, 2020 at $2,000.69 earlier in the session . US gold futures rose 1.4% to $1,993.30.
Oil and other commodity prices soared as stocks tumbled in frantic trading on Monday as the risk of a U.S. and European ban on imports of Russian crude threatened to stretch supply chains and increase inflationary pressure on economies around the world.
Brent crude was last traded up 6.25% on the day at $125.44, while U.S. crude rose $7.19 to $122.78.