MHMarkets：2024.02.19 MHM European Time Analysis

Date: 2024.02.19 MHM European Time Analysis

At the start of Monday, major currency pairs hovered around their closing levels from the previous week. The day's economic calendar is light, with no major data releases expected, and US markets are closed for the Presidents' Day holiday. The Bundesbank of Germany will release its Monthly Report during European trading hours.

The US Dollar saw an uptick in early Friday's American trading session following a report from the Bureau of Labor Statistics that the Producer Price Index (PPI) for January rose more than anticipated. However, profit-taking and end-of-week transactions made it challenging for the USD to maintain its lead over other currencies as the weekend approached. Despite closing its fifth straight week on a positive note, the USD Index slightly receded early Monday but remained well above the 104.00 mark. In the meantime, the yield on the benchmark 10-year US Treasury bond climbed 2.5%, achieving its highest weekly close since November at around 4.3%.

A heat map provides a visual representation of the percentage changes between major currencies, with the base currency selected from the left column and the quote currency from the top row. For instance, selecting the Euro as the base and the Japanese Yen as the quote will show the percentage change between EUR/JPY in the corresponding box.

The Peoples Bank of China (PBOC) announced it has kept the one-year Medium-term Lending Facility (MLF) rate unchanged at 2.50%, as was widely anticipated, a move that did not elicit significant market movement. The AUD/USD pair saw modest gains in the European session, trading around 0.6550, marking a 0.2% increase for the day.

EUR/USD, after dipping below 1.0750 on Friday, made a comeback to erase its losses and ended the day unchanged. The pair continued to gain early Monday, though it remained shy of the 1.0800 mark.

The GBP/USD pair ended slightly down last week but managed to stay above the 1.2600 level. It moved towards 1.2630 in early European trading on Monday.

Over the weekend, Japanese Finance Minister Shunichi Suzuki suggested that a rise in interest rates, potentially impacting the economy through various channels, might be on the horizon, as reported by the Nikkei newspaper. This led to USD/JPY facing slight downward pressure, dipping below 150.00 as the new week began.

Gold, which had fallen below $2,000 earlier in the week, recovered significantly to close around $2,000. XAU/USD continued its upward trajectory into the new week, last seen trading around $2,020.