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US markets were closed due to the Thanksgiving holiday on Thursday, meanwhile, trading volumes are lower due to the holiday with no cash US equity market trading.
The Meeting Minutes from the Fed earlier this month indicated several officials backed the need to moderate the pace of rate hikes, which adds to expectations the central bank will raise rates by 50 basis points next month and end a run of jumbo 75 basis point increases. European stocks gained upside traction and climbed higher after Federal Reserve meeting minutes showed support for more moderate interest-rate increases.
The market mood was upbeat as Asian and European indexes closed in the green but some worrisome headlines may soon trigger a flip in investors’ sentiment. China reported that Beijing and other cities are going back into lockdown amid record coronavirus contagions in the country, which raised concerns that Chinese restrictions could interrupt global commerce and trigger fresh supply-chain issues.
On the Eurozone front, the German IFO Business Climate Index improves to 86.3 in November, which came in better than the market expectation of 85.0. Germany will release the December GFK Consumer Confidence Survey on Friday, foreseen at -39.6 from -41.9 in the previous month. On top of that, tensions between Russia and the EU continue to escalate, as European Commission President Ursula von der Leyen announced they are working full speed on a 9th sanctions package on Moscow.
Main Pairs Movement
The US dollar declined slightly on Thursday, remaining under pressure and extended its weekly decline against most of its major rivals amid a generally upbeat market mood. The greenback was dragged down by the latest FOMC Meeting Minutes, which hinted at a potentially more discrete rate hike next December and the Fed might slow the pace of rate hikes after four 75 basis points hikes. The United States will not publish macroeconomic figures on Friday, and local markets are due to an early close.
GBP/USD advanced higher on Thursday with a 0.48% gain as the cable extended its daily gains towards three-month highs near the 1.2150 mark following the FOMC minutes. On the UK front, a hefty 75 bps rate hike from the BoE this month failed to support the pound as gloomy UK economic forecasts still remained. Meanwhile, EUR/USD failed to climb higher and stuck to a range of between 1.0380 and 1.0430 as liquidity is thinner than usual during the Thanksgiving holiday. The pair was up almost 0.13% for the day.
Gold advanced slightly with a 0.32% gain for the day after climbing towards the $1,758 area and remained sideways during the US trading session, as the optimism in the overall market and the falling greenback both provided support to the precious metal. Meanwhile, WTI Oil was nearly unchanged with a 0.03% gain for the day.
Economic Data
| Currency | Data | Time (GMT + 8) | Forecast |
| EUR | German GDP (QoQ) (Q3) | 15:00 | 0.3% |
