A win for Macron is a win for $EUR. $GOLD is back on its steady grind but is the $BTC bull run over, and can the U.S. avoid recession?
French Elections
The results from Sunday’s initial ballot for the French Election are in with Macron taking 28% vs 24% for Le Pen. Many predict that a win for Macron will boost the $EUR and early results have seen the single currency bounce up from its April lows last week up 0.76% this morning. On the flip, if Le Pen crushes Macron in the debates on the cost of the living crisis on April 20th we could see $EUR retreat to new lows for 2022.
$BTC & $GOLD
Risk appetite has waned recently with two key indicators – $GOLD and $BTC diverging. The annual BTC conference in Miami took place at the end of last week. Historically the conference and April have been catalysts for positive price action with news, rumours and key speakers taking centre stage. Billionaire and PayPal co-founder Peter Thiel made the headlines after declaring Berkshire Hathaway chairman Warren Buffett is a “sociopathic grandpa” who has always been one of the biggest “enemies” of cryptocurrencies. Despite all the news $BTC has yet to find a new local floor and continues to show weakness with the rest of the market. This is despite on-chain data showing “Whales” having been buying huge sums in the dip. Gold on the other hand has seen an inflow of cash boosting its price as fears of recession and dollar dominance hit traditional financial markets.
U.S. Recession
Fed president Loretta Mester said inflation would remain high this year and next even, but she remained confident the U.S. will avoid a recession. The next FOMC will likely push a 50pt rate hike in May, further boosting the $USD strength despite fears that dollar dominance is under attack from Russia and China. However, U.S. earnings due in the upcoming weeks are likely to show their biggest slowdown in the first quarter due to the effects of the ongoing conflict in Ukraine. Bloomberg is forecasting that overall revenues at the big U.S banks are set to fall by as much as 10%.
WEEK AHEAD
It’s a busy week ahead for the key majors, and it’s also worth noting financial announcements from China (RMB).
Monday
CNY Consumer Price Index (YoY)(Mar)
GBP Retail Sales (YoY)(Mar)
Tuesday
GBP Unemployment Rate (3M)(Feb)
USD Consumer Price Index ex Food & Energy (MoM)(Mar)
Wednesday:
GBP Consumer Price Index (YoY)(Mar)
CNY Trade Balance USD(Feb)
Thursday:
EUR ECB Interest Rate Decision
ECB Monetary Policy Decision Statement
USD Retail Sales (MoM)(Mar)
USD Michigan Consumer Sentiment Index(Apr)