The Thanksgiving holiday in the US is leading to subdued market activity today, with trading appetite notably reduced. This quiet session is also influencing European markets, where investors appear largely disinterested amid a lack of significant data releases or major headlines.
In currencies, the US dollar remains largely unchanged across the board in this lacklustre environment. EUR/USD is down slightly by 0.1% to 1.1585, while USD/JPY has edged down 0.1% to 156.35, after initially rising from around 155.90 earlier in the session. GBP/USD is holding most of its post-budget gains near 1.3230, though it is also down 0.1% today.
In equity markets, European indices are posting modest gains as a stable risk sentiment carries through the week. However, with Wall Street closed for Thanksgiving, there is little momentum to drive significant moves.
Commodity markets show gold remaining confined within its technical pennant, trading marginally lower at $4,156.79. WTI crude oil is up 0.4% to $58.89. Bitcoin is showing stronger risk appetite, recovering by 1.0% to $91,127, a welcome rebound following last week’s volatility.
Economic indicators released today include Eurozone consumer confidence remaining steady at -14.2 for November, in line with preliminary estimates. Eurozone money supply (M3) for October matches expectations with a 2.8% year-on-year rise. Germany’s December GfK consumer sentiment also meets forecasts at -23.2. Italy shows some positive momentum with September industrial sales rising 2.1% month-on-month versus a previous decline, and November business confidence surpassing expectations at 89.6.
Notable central bank commentary includes ECB meeting accounts highlighting current uncertainty as a reason to keep rates unchanged, while ECB’s Kazaks states it is not yet appropriate to discuss rate cuts. From the Bank of Japan, Noguchi notes steady progress towards meeting the inflation target but warns that further yen declines could affect underlying inflation.
On the geopolitical front, China has expressed strong concerns over certain elements of the US-Malaysia trade agreement.
For forex traders, the combination of a slow trading day due to the holiday, mixed economic data, cautious central bank comments, and geopolitical tensions suggests a cautious approach. Expect continued subdued volatility in major currency pairs and a lack of clear directional trends until market activity normalises post-holiday.
Original Source: Justin Low of investinglive.com
