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CFD Markets News and Forecasts — 01-01-2024
China’s President Xi Jinping said on Sunday that the Chinese economy had grown more resilient and dynamic in 2023, despite economic numbers that continue to disappoint as the post-Covid recovery stalls.
Key quotes
“China will "consolidate and enhance the positive trend of economic recovery and achieve stable and long-term economic development.”
"We must comprehensively deepen reform and opening up, further boost confidence in development, enhance economic vitality, and make greater efforts to promote education, promote science and technology, and cultivate talents.”
“China will promote high-quality development and balance development and security in a well-coordinated way.”
Market reaction
At the time of writing, the AUD/USD pair is trading around 0.6807, down 0.07% on the day.
- Gold price gains ground near $2,065 during the early Asian session on Tuesday.
- The US Chicago Purchasing Managers' Index (PMI) arrived at 46.9 in December vs. 55.8 prior, worse than expected.
- The chairman of the Chinese Communist Party Xi Jinping made vague comments about supporting the economy.
- The US S&P Global Manufacturing PMI is due on Tuesday.
Gold price (XAU/USD) begins the first trading day of 2024 on a positive note during the early Asian session on Tuesday. The uptick of yellow metal is supported by the softer US Dollar (USD) and the positive development surrounding China’s economic stimulus measure. Gold price currently trades around $2,065, up 0.19% on the day.
That being said, the large anticipation that the US economy could enter a recession and the potential rate cuts from the Federal Reserve (Fed) weigh on the Greenback and lift USD-denominated commodities. Investors will closely watch the December jobs data on Friday, including US Nonfarm Payrolls (NFP). The NFP figure is expected to show an increase of 163K in December versus 199K in November. The Unemployment Rate is estimated to climb to 3.8%, while December’s Average Hourly Earnings are expected to grow 0.3% MoM. If the report shows weaker-than-expected data, this could exert some selling pressure on the Greenback.
On Friday, the US Chicago Purchasing Managers' Index (PMI) came in at 46.9 in December from the previous reading of 55.8, worse than the market expectation of 51.0.
On Sunday, the Chairman of the Chinese Communist Party Xi Jinping made vague comments about supporting the economy. Jinping stated that the government will consolidate and enhance the positive trend of economic recovery and achieve stable and long-term economic growth. He added that the authorities must deepen reform, improve confidence in growth, and make more efforts to promote education, science, and technology and cultivate talents.
Gold traders will keep an eye on the US S&P Global Manufacturing PMI, due later on Tuesday. Later this week, the Federal Open Market Committee (FOMC) minutes will be a closely watched event ahead of the US Nonfarm Payrolls (NFP) report on Friday. Traders will take cues from data and find trading opportunities around the gold price.
- AUD/USD trades on a negative note amid the quiet session in the first trading day of 2024.
- December’s Australian Judo Bank final Manufacturing PMI arrived at 47.6 from the flash reading of 47.8, weaker than expected.
- The US Chicago PMI came in at 46.9 in December vs. 55.8 prior, below the market consensus.
- Traders will monitor December’s US S&P Global Manufacturing PMI, due on Tuesday.
The AUD/USD pair drifts lower on the first trading day in 2024 during the early Asian session on Tuesday. The markets remain quiet in the first week of the year. The pair currently trades around 0.6808, losing 0.04% on the day.
On Tuesday, the Australian Judo Bank final Manufacturing PMI for December 2023 came in at 47.6 from the flash reading of 47.8, weaker than the expectation of 47.7. The December Manufacturing Output Index backed to a historically low reading of 45.5. The report suggests that the manufacturing sector in Australia has shown a consistent easing trend throughout 2023, responding to monetary policy, with inflation aligned with the RBA's target levels. The sector's activity is gradually slowing down, and we estimate that this trend will continue through early 2024.
On the USD’s front, the Chicago Purchasing Managers' Index eased from 55.8 in November to 46.9 in December, below the market consensus of 51.0. At the Federal Reserve (Fed) meeting in December 2023, the Fed delivered dovish remarks, and investors have priced in three rate cuts in 2024. According to the WIRP, the markets are pricing in 15% odds of a rate cut on January 31 and is nearly priced on March 20. This, in turn, exerts some selling pressure on the US Dollar (USD) and acts as a tailwind for the AUD/USD pair.
Looking ahead, December’s US S&P Global Manufacturing PMI will be released on Tuesday. On Wednesday, the Federal Open Market Committee (FOMC) will be a closely watched event. Fed’s Barkin is set to speak on Wednesday and Friday, while Logan is scheduled to speak on Saturday.
| Raw materials | Closed | Change, % |
|---|---|---|
| Silver | 23.776 | -0.81 |
| Gold | 2062.606 | -0.2 |
| Palladium | 1100.2 | -2.76 |
| Index | Change, points | Closed | Change, % |
|---|---|---|---|
| NIKKEI 225 | -75.45 | 33464.17 | -0.22 |
| Hang Seng | 3.86 | 17047.39 | 0.02 |
| ASX 200 | -23.5 | 7590.8 | -0.31 |
| DAX | 50.09 | 16751.64 | 0.3 |
| CAC 40 | 8.02 | 7543.18 | 0.11 |
| Dow Jones | -20.56 | 37689.54 | -0.05 |
| S&P 500 | -13.52 | 4769.83 | -0.28 |
| NASDAQ Composite | -83.79 | 15011.35 | -0.56 |
| Pare | Closed | Change, % |
|---|---|---|
| AUDUSD | 0.68132 | -0.21 |
| EURJPY | 155.693 | -0.35 |
| EURUSD | 1.10397 | -0.19 |
| GBPJPY | 179.746 | -0.11 |
| GBPUSD | 1.27458 | 0.15 |
| NZDUSD | 0.63193 | -0.19 |
| USDCAD | 1.32393 | 0.12 |
| USDCHF | 0.84108 | -0.31 |
| USDJPY | 141.027 | -0.23 |
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