Global markets are volatile on inflation fears and interest rate hikes, while investors are hoping that the Federal Reserve will pull back from its interest rate hike plan.
References bloomberg To the most important events and basic economic data that must be monitored during the week, including:
Consumer Confidence Index, Tuesday
Eurozone manufacturing purchasing managers index
consumer price index
Unemployment in Europe, Wednesday
Interest rate decision by the Federal Reserve, Wednesday
Earnings Meta, Wed
The European Central Bank’s decision on interest rates in the eurozone, Thursday
UK interest rate decision, Thursday
Unemployment data in America, Friday
Awaiting interest rate announcements, markets witnessed some volatility on Tuesday.
The dollar is rising
The dollar rose, on Tuesday, ahead of an expected series of central bank decisions, but remained on its way to recording a fourth consecutive monthly loss.
The US central bank is set to set interest rates on Wednesday, followed by interest rates from the European Central Bank and the Bank of England on Thursday.
The currencies did not find a specific direction to follow during the night, as the euro fell against the dollar in early trading in Europe and fell in the latest trading by 0.41 percent to 1,081 dollars, according to Reuters.
But the euro remains up more than 0.8 percent for the month, hovering around a nine-month peak after falling energy prices gave the euro-zone economy room to move.
The dollar index, which measures the performance of the currency against a basket of currencies, rose 0.31 percent, recording 102.56 Tuesday.
But it is still down by 0.9 percent for the entire month of January, which means that it is heading to record its fourth consecutive monthly loss, as it has fallen 11 percent since reaching a 20-year peak in late September.
The pound sterling fell in the latest trading by 0.29 percent, recording 1,231 dollars, but it is on its way to record gains for the fourth month in a row.
The Japanese yen rose 0.1 percent, recording 130.34 per dollar, and is on its way to recording an increase for the third month in a row, as markets expect a change in the country’s monetary policy.
The Australian dollar fell in the latest transactions by 0.74 percent to $ 0.701, and the New Zealand dollar also fell 0.63 percent, recording $ 0.643.
European stocks are falling
European stocks fell on Tuesday, dragged down by health care stocks, as investors refrained from aggressive bets and expected another round of interest rate hikes by major central banks this week.
The European Stoxx 600 index fell 0.2 percent by 08:16 GMT, but it was on its way to ending January with a positive performance, supported by hopes for better-than-expected corporate earnings and economic resilience.
Rheinmetall shares, which fell by five percent after offering convertible bonds, were the biggest obstacle among the industrial sector stocks, while Novo Nordisk and AstraZeneca pushed the health care sector to decline, according to Reuters.
The US Federal Reserve begins its two-day meeting, Tuesday, and is widely expected to raise interest rates by 25 basis points to 4.5-4.75 percent.
Meanwhile, the European Central Bank and the Bank of England are expected to raise interest rates by 50 basis points each, to 2.5 percent and 4 percent, respectively, on Thursday.
Oil is going down
Oil prices fell on Tuesday, as the threat of further rate hikes and large inflows of Russian crude outpaced expectations of a recovery in demand from China.
By 07:15 GMT, Brent crude futures for March delivery fell 25 cents to $84.65 a barrel.
The March contract expires on Tuesday, and the most heavily traded April contract fell by 38 cents, or 0.45 percent, to $84.12.
Similarly, US West Texas Intermediate crude futures fell 44 cents, or 0.56 percent, to $77.46 a barrel, according to Reuters.
“The oil markets are facing downward pressure as risk-off transactions prevail ahead of the (US central bank) Federal Reserve meeting, along with the strength of the dollar,” said Tina Teng, an analyst at CMC Markets.
She added that the demand outlook remains vague despite China’s reopening, as Russian exports appear not to have been affected by the sanctions.
Investors expect the Federal Reserve to raise interest rates by 25 basis points, Wednesday, with a half-point increase from the Bank of England and the European Central Bank the following day.
Higher rates could slow the global economy and weaken demand for oil.
Five delegates from OPEC + told Reuters, on Monday, that the group’s Joint Ministerial Monitoring Committee is expected to recommend maintaining the current oil production policy at its scheduled meeting this week.
OPEC + agreed in October to reduce the production target of two million barrels per day, or about 2 percent of global demand, from November to 2023.
Russia continues to supply the world market with its oil despite the embargo imposed by the European Union and a ceiling imposed by the Group of Seven on oil prices due to its invasion of Ukraine, which put pressure on prices.
However, indications of potential demand strength from China, after the growth of the country’s economic activity, mitigated the decline.
gold gains
Gold prices fell on Tuesday, but are heading for gains for the third month in a row, while dealers await the Federal Reserve’s interest rate decision this week.
Gold fell in spot transactions 0.3 percent to $ 1917.56 an ounce by 05:47 GMT, but it is heading for a monthly gain of more than five percent.
And US gold futures fell 0.3 percent to 1933.6 dollars.
This comes while the dollar index is witnessing stability and is heading at the same time to record a decline for the fourth month in a row. The weakness of the dollar makes the bullion priced in it more attractive to investors, according to Reuters.
With regard to other precious metals, silver fell in spot transactions 0.7 percent to 23.43 dollars an ounce, platinum fell 0.5 percent to 1003.51 dollars, and palladium rose 0.2 percent to 1641.08 dollars. The three metals are heading for a monthly decline.
