EUR/USD: euro continues to decline against the background of yesterday's bearish trend
The EUR/USD price continues to move downwards, testing the 1.0865 mark, which brings it closer to the minimum values of the beginning of March.
The market is focused on the updated statistics on inflation in the eurozone for February. The expectations were confirmed: The consumer goods price index increased by 0.6% over the month and by 2.6% over the year. Core inflation also showed an increase of 0.7% and 3.1%, respectively, exceeding the goals of the European Central Bank (ECB). At the same time, ECB representative Pablo Hernandez de Cos expressed the opinion about the possibility of lowering interest rates in the summer if the trend of slowing inflation continues. Despite some disagreements within the ECB, this approach seems reasonable. Recent ECB forecasts indicate a decrease in expected inflation in the coming years, especially due to a decrease in the impact of energy costs, projected at an average of 2.3% in 2024, 2.0% in 2025 and 1.9% in 2026.
- Resistance levels: 1.0900, 1.0930, 1.0964, 1.1000.
- Support levels: 1.0864, 1.0838, 1.0820, 1.0800.
NZD/USD: New Zealand Dollar resumes decline
During the trading session, NZD/USD demonstrated an increase in the "bearish" trend, heading towards testing the 0.6060 level for a possible break down and updating the lows recorded since February 14.
Activity on the New Zealand dollar is mainly caused by the results of the last meeting of the Reserve Bank of Australia, which affects expectations regarding the policy of the Reserve Bank of New Zealand due to the similarity in the approaches of managing monetary policy of the two countries. At the RBA meeting, it was decided to leave the key rate at 4.35%, while rejecting previously possible assumptions about further rate increases. This indicates a likely move to lower rates, which is similarly expected from the RBNZ. Monetary policy easing in this region is projected to follow similar actions by the US Federal Reserve, the European Central Bank and possibly the Bank of England towards the end of 2024.
- Resistance levels: 0.6076, 0.6100, 0.6130, 0.6158.
- Support levels: 0.6049, 0.6030, 0.6000, 0.5950.
GBP/USD: market expects inflation data from the UK
In the Asian trading session, against the background of the strengthening of the US dollar and the lack of news from the UK, the GBP/USD pair shows a moderate drop, being at 1.2717.
The strengthening of the dollar is associated with anticipation of the results of the upcoming meeting of the Bank of England on monetary policy, scheduled for Thursday at 14:00 GMT. Analysts do not expect changes in the regulator's policy, but there is concern about possible signals of an imminent rate cut, preceding similar steps by the Federal Reserve and the European Central Bank. The upcoming publication of inflation data on Wednesday will have a significant impact on the regulator's decisions. The consumer price index in February is expected to show an increase to 0.7% month-on-month and a decrease to 3.5% year-on-year, while core inflation may fall to 4.6%. The growth of the retail price indicator is also projected to slow down from 4.9% to 4.5% year-on-year.
- Resistance levels: 1.2750, 1.2860.
- Support levels: 1.2690, 1.2540.
Crude Oil market analysis
In the Asian session, WTI crude oil quotes showed fluctuations, remaining near the $82.00 bar and approaching the recently updated highs recorded on November 3.
China's increased appetite for oil imports has a positive impact on prices: the latest government report showed that at the beginning of the year refining reached 119.0 million tons, which is 3.0% higher than in the same period of the previous year. The market's attention is also focused on the recent attacks on oil refining facilities in Russia, which may lead to a decrease in the amount of fuel available on the market.
Analysts' views are also focused on the expected decline in supplies from OPEC+. According to the latest data, Iraq plans to reduce exports by 3.3 million barrels per day, reacting to previous production overflows. At the same time, Saudi Arabia reduced sales in January by 0.2% to 6.30 million barrels per day, continuing the downward trend that began in December, when 6.31 million barrels per day were shipped.
- Resistance levels: 82.86, 84.27, 85.50, 86.50.
- Support levels: 82.00, 81.00, 80.00, 79.07.