Equites are climbing after the S&P 500 jumped to new highs last week. Overall, markets are bullish, supported by positive economic data and inflationary environments.
The Federal Reserve sent the likelihood of a March interest rate hike up to almost 50%. Janet Yellen exuded confidence in the US economic climate, adding that it would be unwise to wait too long before increasing rates.
EUR/USD – broke out of the wedge after it appeared to breaking below it. However, it remains to be seen how much upside there is for the EUR as there are quite a few obstacles preventing a sustained strengthening of the EUR, also shown in the weak growth we saw in the German data. After the Dutch and French elections, it could be that some anxiety will disappear. However, we also have the Greek crisis which will get its next chapter in the next few days.
Stocks are rising following Federal Reserve Chair Janet Yellen’s speech yesterday. Yellen was more positive than investors were expecting, which sent US treasury prices lower. The chair noted that encouraging economic data could cause the Fed to raise rates, adding that it is unwise to wait too long to do so, or risk sending the economy into a recession.
Investors hold their breath, awaiting Janet Yellen’s speech later today. The market is subdued, following the dollar’s command as the currency drags equities lower.
Japan’s GDP sent equities higher this morning. Reports showed that Japan’s GDP rose 0.2% in the fourth quarter of 2016. The growth derives from an increase in exports due to a weaker yen however, the data shows that domestic demand is lagging. Japan had a 1% GDP growth for 2016. This suggests that the Bank of Japan will not change its monetary policy in the near future.
What where the biggest movers of this weeks market?
As earning reports trickle out, markets have become stronger. Gold hit a three-month high yesterday, but as the dollar advances, it knocks the safe-haven off its pedestal, however, will the downward trend last?
Dollar is steering higher as Treasury prices wane. The euro is faltering under the weight of the geopolitical risks laid out for the bloc of nations.
The stronger dollar has sent gold and oil lower. The euro is weighed down as geopolitical risk pushes European equities lower.