Ongoing bullish momentum in the US Dollar exerted additional downward pressure on risk-linked assets. This trend unfolded amidst indications of diminishing inflationary forces on both sides of the Atlantic, coupled with consistent expectations of potential interest rate cuts by the Federal Reserve (Fed) and the European Central Bank (ECB) during the upcoming summer.
Here is what you need to know on Friday, March 1:
Additional gains in the US Dollar prompted the USD Index (DXY) to surpass the 104.00 mark and extend its rally for the third consecutive session. As the week concludes, the upcoming economic calendar includes the final S&P Global Manufacturing PMI taking the lead, accompanied by Construction Spending, the conclusive Michigan Consumer Sentiment, and the always significant ISM Manufacturing PMI. Notably, a lineup of speakers from the Federal Reserve, including Williams, Logan, Waller, Bostic, Daly, and Kluger, are scheduled to address.
EUR/USD faced increased selling pressure, testing the critical support at 1.0800 in response to the continued upward momentum of the US Dollar. In the eurozone, focus shifts to preliminary inflation figures for February on March 1, alongside the Unemployment Rate and the ultimate Manufacturing PMI for both Germany and the entire bloc.
GBP/USD experienced a decline to multi-day lows, signaling a potential descent towards the 1.2600 area in the near term. Meanwhile, on the other side of the Channel, March 1 brings data on Nationwide Housing Prices and the final S&P Global Manufacturing PMI.
USD/JPY resumed its bearish bias, revisiting the 149.20 region as investors reassessed the possibility of a sooner-than-expected lift-off by the Bank of Japan. March 1 brings key releases in “The Land of the Rising Sun,” including the Unemployment Rate and Consumer Confidence for February.
AUD/USD continued its loss of momentum, breaching the 0.6500 support amid concerns related to China and the strength of the US Dollar. In Australia, the sole release on Friday is Commodity Prices.
Attention is set to return to China, with the release of Manufacturing PMIs tracked by both the NBS and Caixin on March 1. USD/CNH, after a multi-day positive streak, experienced a slight drop to the 7.2100 zone on Thursday.
WTI prices displayed continued volatility in the upper range around $78.00 per barrel.
Gold prices reached four-week highs, retesting the $2,050 region per troy ounce, driven by lower yields and despite notable gains in the US Dollar. Silver followed suit, overcoming three consecutive daily pullbacks and approaching the $22.80 level per ounce.
