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Market trading was light during the Thanksgiving holiday, with the U.S. dollar index rising first and then falling.
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Hello everyone, today XM Forex will bring you "[XM official website]: Market trading was light during the Thanksgiving holiday, and the U.S. dollar index first rose and then fell." Hope this helps you! The original content is as follows:
In early trading in Asia on Friday, November 28, spot gold was trading around US$4,180 per ounce. The price of gold fell slightly on Thursday. Due to the US Thanksgiving holiday, market trading was light, and the market paid close attention to the policy trends of the Federal Reserve, especially After Hassett became the popular candidate to succeed Powell as chairman of the Federal Reserve, his tendency to advocate interest rate cuts aroused widespread market attention; U.S. crude oil is trading around $59 per barrel, and investors are paying close attention to the progress of Russia-Ukraine peace negotiations and the upcoming OPEC+ production policy meeting.
The U.S. dollar index extended its decline in light trading on Thursday and is expected to post its largest weekly decline in four months. As of the close, the U.S. dollar index rose slightly by 0.05% to 99.58, but the cumulative decline this week reached 0.60%, the worst weekly performance since July.
The Japanese yen rose 0.10% to 156.33 yen against the US dollar, supported by hawkish www.xmtraders.comments from Bank of Japan officials. ING foreign exchange strategist Francesco Pesole pointed out that the current market environment may create favorable conditions for the Japanese authorities to intervene in the currency market, but the urgency of intervention has been weakened by the stagnation of exchange rate trends.
The euro fell 0.05% to $1.1596 against the dollar, having earlier hit a one-and-a-half-week high of $1.1613. The market is paying close attention to the progress of peace negotiations in Ukraine, and any positive signals may further boost the euro.
As for the Swiss franc, analysts believe that if a peace agreement is reached in Ukraine, it may put pressure on the Swiss franc, which has always acted as a geopolitical safe-haven currency. USD/CHF was last up 0.16% at 0.8056.
New Zealand dollar jumps to three-week high at $0.5728, up about 2% since the Reserve Bank of New Zealand turned hawkish a day ago. Although the central bank cut interest rates, it said it had discussed keeping rates unchanged and suggested that the easing cycle may be over.
The Australian dollar also strengthened, trading at $0.6536, on higher-than-expected inflation data, which further supported the view that the local easing cycle is over.
Mark Haefele, chief investment officer of UBS Global Wealth Management, suggested that investors should re-examine currency allocation as the attraction of the U.S. dollar weakens, recommending the euro and Australian dollar instead of the U.S. dollar.
However, Themos Fiotakis, global head of foreign exchange strategy at Barclays Bank, has a different view. He believes that "the strength and resilience of the U.S. economy" is still an important factor supporting the dollar, and also points out that the "expensiveness of the euro" is also a consideration.
Traders said that if White House economic adviser Hassett is named the next Federal Reserve chairman, it will be a negative catalyst for the dollar due to his advocacy of interest rate cuts. Markets currently expect the Fed to cut interest rates by more than 90 basis points over the next year and a half.
Asian Markets
Japan’s latest economic data is reinforcing market expectations that the Bank of Japan may restart its interest rate hike cycle in the www.xmtraders.coming months. The expectations were fueled by Tokyo-area inflation continuing to be well above target and a brief pickup in industrial output ahead of an expected slowdown. Economists pointed out that these data will allow the Bank of Japan to continue its policy tightening path. In addition, the recent drop in the yen exchange rate to a 10-month low has added new variables to policy decisions. Policymakers worry that further yen depreciation could push up food and imported goods inflation. Divisions remain within the Japanese government. Prime Minister Sanae Takaichi's inflation-focused advisers argue that interest rates should not be raised while consumption remains weak and the economy shrinks in the third quarter. But stubborn inflation, a weak yen and credible wage growth data have pushed the Bank of Japan's board of policy toward an early tightening of monetary policy. Taking various factors into consideration, as inflation continues to be higher than the policy target and the Bank of Japan tends to take preemptive actions to stabilize prices and exchange rates, Japan is gradually approaching the next interest rate hike node, whether in December or early next year.
European market
Accounts from the European Central Bank's October meeting showed that they unanimously agreed to keep the three major interest rates unchanged. Policymakers pointed out that the inflation outlook and new data were broadly consistent with the September baseline. The economy is expanding despite global headwinds, giving the Council confidence that its current stance remains appropriate.
Members stressed that December will bring key new information, including the first extension of workforce forecasts to 2028. The forecasts will provide "a clearer picture of future prospects."
However, these reports shed light on views on whether the rate-cutting cycle is fully over. Some members argued that the optimistic outlook meant "modest and temporary fluctuations in inflation should not be fine-tuned".
Others cautioned that the council must keep a "completely open mind", noting that if downside risks intensify or are expectedInflation continues to be lower than expected, and another interest rate cut is reasonable. The view emphasizes that the threshold for action should not be "higher than normal".
Sentiment in the EU and Eurozone improved only slightly in November, with economic confidence indicators rising by 0.2 percentage points in both, reaching 96.8 and 97.0 respectively. The employment expectations indicator has improved - rising to 98.8 in the European Union and 97.8 in the Eurozone. Both indicators are below the historical average of 100.
Industry trends again show uneven dynamics. Confidence in the service, retail and construction industries has improved. But further weakening in industry confidence almost offset these gains, and the overall ESI remained flat. Consumer sentiment has changed little.
Among the major EU economies, sentiment gains were led by Spain (2.0), Italy (1.1), France (0.) and Poland (0.5), while Germany and the Netherlands held steady at -0.3.
The above content is all about "[XM official website]: Market trading was light during the Thanksgiving holiday, and the US dollar index first rose and then fell". It was carefully www.xmtraders.compiled and edited by the XM foreign exchange editor. I hope it will be helpful to your trading! Thanks for the support!
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