GBP/USD: signs of a slowdown in the American economy
With the strengthening of the US dollar, the GBP/USD pair is experiencing a correction, settling at 1.2666.
The latest data on spending by British households showed that their index increased by 5.0% year-on-year in the fourth quarter, which is less than the previous growth of 8.3%. Spending in high—income families increased by 5.6%, while in lower-income families it increased by 4.5%. High inflation among households is also noticeable — 6.3%, caused by significant mortgage interest. It is expected that the number of approved mortgage loans will rise from 50.46 thousand to 52 thousand, and their amount will increase from -0.83 billion pounds to 0.20 billion pounds.
The US dollar is holding at 103.60 on the USDX index, despite the decline in US GDP in the fourth quarter from an initial 4.9% to 3.2%, which was lower than analysts' expectations of 3.3%. The GDP deflator decreased from 3.3% to 1.7%, and the contribution of sales to GDP decreased from 3.6% to 3.5%. The price index for personal consumption was at the level of 1.8% instead of the preliminary 2.6%.
- Resistance levels: 1.2700, 1.2830.
- Support levels: 1.2630, 1.2510.
USD/CAD: stabilization of the currency pair before the release of US inflation data
The USD/CAD currency pair is near the 1.3570 level, demonstrating a contradictory movement after yesterday's significant rise, when the US dollar reached new highs on December 13.
The US dollar was again helped by expectations of an extension of the aggressive monetary policy of the Federal Reserve System against the background of recent economic reports. The personal consumption price index for the last quarter of 2023 was adjusted from 1.7% to 1.8%, and the basic expenditure index was adjusted from 2.0% to 2.1%. Analysts also note an adjustment in US GDP data for the same period, with economic growth of 3.2% per annum, rather than 3.3%, as previously expected.
Canada, in turn, will present information on the dynamics of its GDP today. The country's economy is expected to show growth of 0.8% year-on-year in the last quarter of 2023, after a decrease of 1.1% in the previous quarter, while stability is projected at 0.2% for December.
- Resistance levels: 1.3600, 1.3650, 1.3700, 1.3750.
- Support levels: 1.3550, 1.3500, 1.3450, 1.3400.
USD/CHF: currency pair shows stable movement without sudden changes
The USD/CHF currency pair shows a neutral movement, stabilizing around 0.8785. Trading activity is moderate against the background of the upcoming announcement of economic data from the United States and the European Union, in particular inflation reports.
In Germany, the annual growth of the consumer price index is expected to slow down in February to 2.6% from the previous 2.9%, while the monthly figure may increase from 0.2% to 0.5%. The harmonized index according to EU standards is expected to decrease year-on-year from 3.1% to 2.7%, and in a month it will grow to 0.6% after a decrease of -0.2% a month earlier. The publication of final inflation data in the European region is expected tomorrow, where the base index is expected to decline from 3.3% to 2.9%.
Switzerland will present a report on the KOF index of leading economic indicators during the day, which is expected to increase from 101.5 to 102.0 points. GDP statistics for the last quarter of 2023 are also on the agenda: economic growth is projected to slow down to 0.1% on a quarterly basis, but accelerate from 0.3% to 0.7% on an annual basis.
- Resistance levels: 0.8800, 0.8820, 0.8850, 0.8885.
- Support levels: 0.8782, 0.8760, 0.8730, 0.8700.
Crude Oil market analysis
During Asian trading, WTI Crude Oil prices are exploring the 78.20 mark, trying to break it up with moderate market activity.
The asset is supported by expectations of continued production restrictions from OPEC+ in the second quarter. Some experts also suggest strengthening current measures by the end of the year to maintain prices near the 80.00 level.
However, on the other hand, price growth is hampered by fresh data from the Energy Information Administration of the U.S. Department of Energy (EIA), which showed an increase in oil reserves for the week ended February 23, from 3.514 million barrels to 4.199 million barrels, which significantly exceeds the initial forecasts of 2.743 million barrels.
- Resistance levels: 78.00, 79.07, 80.00, 81.00.
- Support levels: 77.00, 76.00, 75.00, 74.00.