As global markets navigate a landscape of economic uncertainty, all eyes are on the upcoming release of key economic data and policy announcements. The Federal Reserve has indicated that it requires clear evidence of economic weakness and subdued inflation to consider loosening monetary policy further. This cautious stance has market participants eagerly anticipating the S&P Global preliminary US business PMI data, expected to be released soon. The PMI data, considered top-tier, is likely to provide crucial insights into the health of the US economy.
Meanwhile, gold prices have regained momentum, gearing up for another potential rise early Friday. Market participants are closely monitoring developments as gold buyers eagerly await clarity on US President Donald Trump’s trade policies. President Trump's low-tax, light-touch regulation policies are anticipated to foster economic growth, but his recent comments about preferring no tariffs on China have added a layer of complexity to market expectations.
In Japan, the Bank of Japan's anticipated interest rate hike to 0.50% in January has influenced currency markets, with the USD/JPY trading back below 156.00. The Japanese Yen continues to offer support as higher inflation forecasts signal further rate hikes on the horizon. Investors are keenly awaiting Governor Ueda's press conference for more insights.
Bitcoin remains a focal point in the digital asset sphere, trading near $103,000 on Thursday. The Presidential Working Group on digital assets is set to explore the feasibility of creating a national digital asset stockpile, a move that could significantly impact the cryptocurrency market.
In the currency markets, the AUD/USD maintained its bounce above 0.6300 during Friday's Asian trading session. The stability of the Australian Dollar reflects broader market dynamics as investors weigh global economic signals.