13/12/2022 Evening Reports

"Soft Landing" Expectations Increased After US Inflation...

“Soft Landing” Expectations Increased After US Inflation…

Before the FED meeting decisions to be announced tomorrow, we followed the November inflation data from the USA at 16.30 (GMT+3) today. The data came as follows.

  • USA – Consumer Price Index (November) (monthly): 0.1% (Exp: 0.3% ; Previous: 0.4%)
  • USA – Consumer Price Index (November) (annual): 7.1% (Expected: 7.3% ; Previous: 7.7%) 
  • USA – Core Consumer Price Index (November) (monthly): 0.2% (Exp: 0.3% ; Previous: 0.3%)
  • USA – Core Consumer Price Index (November) (yoy): 6.0% (Exp.: 6.1% ; Previous: 6.3%)

When we look at the data, there is a decrease in both headline and core inflation compared to the next month. In addition to the headline inflation, the decline in core inflation led to a dovish mood in the markets. While the Dollar Index declined to the level of 103.60, the EURUSD parity rose to 1.0670. The ounce Gold side jumped to $ 1820, while the USDJPY pair was the hardest hit from the data, falling to 134.65. The US 10-year bond yield also fell below 3.5%. There was also a slight reaction in US futures indices.

When we look at the data, we see that there is a limited decrease on the energy side, but inflation continues on the food side. For this reason, although this month’s inflation was met by the market as a pigeon, there are still question marks about inflation in the coming months.

After the data, the possibility of the FED to increase interest rates by 50 basis points strengthened tomorrow, while the expectation for an interest rate hike was 25 basis points each in the February and March 2023 meetings, and the interest ceiling decreased to 4.86%.

Tomorrow, with the latest inflation data, we will see the thoughts of the Fed’s Powell and the FOMC members on the dot plot chart.

  • The UK’s Unemployment Rate rose from 3.6% to 3.7% in October, according to the latest data released by the UK’s Office for National Statistics on Tuesday. The number of people claiming unemployment benefits increased by 30.5 thousand in November, compared to the previously recorded -6.4 thousand and -13.3 thousand expectations. The Average Income Index, including bonuses, increased from 6.0% to 6.1% in October. Market expectations were for an increase to 6.2%.
  • Consumer inflation in Germany eased from 10.4% to 10.0% on an annual basis in November, in line with the expectations. Inflation decreased by 0.5% on a monthly basis.
  • Turkey’s industrial production increased by 2.5% in October, contrary to the 0.1% increase expectation. Retail sales, on the other hand, increased by 1.4%.
  • Germany’s October ZEW Economic Sentiment Index rose sharply to -23.3 in December from -36.7 in November. In addition, the Current Situation Index rose from -64.5 to -61.4 but fell short of the market expectation of -57. In the same period, the ZEW Economic Sentiment Index for the euro area rose from -38.7 to -23.6.
  • The ZEW Institute, interpreting the data, said, “The vast majority of financial market experts expect the inflation rate to decline in the coming months.” Also, “Combined with the temporary stability in the energy markets, this leads to a significant improvement in the economic outlook.” The comment has been made.
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    Support Level: 1.0600 – 1.0470 – 1.0340 Resistance Level: 1.0680 – 1.0770 – 1.0940


    EUR/USD – Above 1.06 After US Inflation…

    After the US November inflation data, which came today at 16.30 (GMT+3), we saw a movement above 1.06 in the EURUSD parity and the parity rose to the level of 1.0650. In November inflation, there is a decline in the headline and core side compared to the previous month and expectations. There is also a loss of momentum on a monthly basis and before the FED meeting tomorrow, the dovish sentiment against the Dollar has increased even more in the market. The pair is above 1.06 for now. If the daily candle can be closed above this zone, step by step 1.0770 and 1.0940 levels will continue to be on target.

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    Support Level: 1806 – 1789 – 1779 Resistance Level: 1824 – 1838 – 1855


    XAU/USD – P1806 Resistance Passed, We Will Watch for Possible Closures…

    Ounce Gold threw itself above the 1806 resistance, which it had been testing for a while, with the weakening of the Dollar Index after the US inflation data and the decline in the US 10-year bond yield. Tomorrow’s FED meeting will also be important, but technically, the positive image in the commodity will become more evident in the possible daily candle closings above 1806.

    After the data, the yellow metal rose as high as 1815. It can be expected that the positive stance above 1806 will continue in the movements in the evening.

    Let us remind you that the 1806 level worked as an important support and resistance until yesterday. Therefore, the crossing of this zone and the candle closings are an important technical event.

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    Support Level: 135.00 – 134.25 – 133.60 Resistance Level: 135.90 – 136.50 – 137.45


    USD/JPY – Very Affected by Changes in US Bonds…

    With the rapid decline in the US 10-year bond yield after the inflation data, the USDJPY parity also declined sharply. For the pair, which regressed from 138.05 to 134.85, the 133.60 level tested in the previous weeks will be important. The messages that will come from the FED tomorrow are considered as doves and with the effect of this, the support of 133.60 has now become an important position.

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    Support Level: 76.90 – 75.60 – 72.30 Resistance Level: 80.40 – 83.00 – 86.40


    BRENT Continuing the Reaction Started from the Critical 75.60 Weekly…

    In the new week, Brent held at the 75.60 level, which it tested last week and which corresponds to the 1.5-year trend, and continues its reaction from this region during the week. Brent price is close to 80.40 resistance as of today. We will monitor the hold on the trend. In general, it is technically difficult for the rises to be permanent unless it goes above 86.40. We will be monitoring these reactions. However, if the 75.60 support below is broken by the weekly candle, we can see the continuation of the strong declines in oil, the first critical support will be 69.50.

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