Disappointing GDP Growth and Rising Inflation Spark Risk Sentiment U-Turn
| Action Insight Mid-Day Report 4-25-24 |
Disappointing GDP Growth and Rising Inflation Spark Risk Sentiment U-Turn |
Risk sentiment took a sharp downturn following the release of US Q1 GDP data, which revealed weaker-than-expected economic growth alongside an acceleration in both headline and core PCE price indexes. This combination suggests that the US economy may be caught in a challenging cycle where high interest rates are dampening economic activity without effectively curbing inflationary pressures. In response, DOW futures plummeted by over -300 pts at the time of writing, signaling a steep market open, while 10-year Treasury yield is making moves to break 4.7% mark. In the currency markets, Dollar is attempting a rebound driven by the shift in risk sentiment, though it remains uncertain whether it can fully offset this week's losses. Currently, Japanese Yen remains the weakest performer for the week, followed by Swiss Franc. Australian Dollar continues to hold the lead as the strongest, with British Pound and New Zealand Dollar also showing resilience. Euro and Canadian Dollar are positioned in the middle. But these standings could shift dramatically if the risk-off mood intensifies throughout the remainder of the week... |
GBP/USD Mid-Day Outlook Daily Pivots: (S1) 1.2368; (P) 1.2414; (R1) 1.2495; More... Intraday bias in GBP/USD remains neutral for the moment. Near term outlook stays bearish as long as 1.2538 support turned resistance holds. Break of 1.2421 minor support will argue that rebound from 1.2298 has completed and bring retest of this low. However, decisive break of 1.2538 will bring stronger rally to 55 D EMA (now at 1.2585) instead. | |
| GMT | Ccy | Events | Actual | Forecast | Previous | Revised |
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| 06:00 | EUR | Germany GfK Consumer Confidence May | -24.2 | -25.5 | -27.4 | -27.3 | | 08:00 | EUR | ECB Economic Bulletin | | 12:30 | USD | Initial Jobless Claims (Apr 19) | 207K | 210K | 212K | | 12:30 | USD | GDP Annualized Q1 P | 1.60% | 2.10% | 3.40% | | 12:30 | USD | GDP Price Index Q1 P | 3.10% | 3.00% | 1.60% | | 12:30 | USD | Goods Trade Balance (USD) Mar P | -91.8B | -91.2B | -90.3B | -90.3B | | 12:30 | USD | Wholesale Inventories Mar P | -0.40% | 0.20% | 0.50% | 0.40% | | 14:00 | USD | Pending Home Sales M/M Mar | 0.90% | 1.60% | | 14:30 | USD | Natural Gas Storage | 87B | 50B |
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