Weekly Outlook: Markets likely to react Fed's rate decision, trump's economic policies

November 30, 2024 (MLN): In anticipation of the Fed's interest rate announcement, the market has entered the final month of the year. 

Data on non-farm payroll, which is due on Friday, may provide the market with some indication of what the Fed will do next about interest rates. 

The market will also receive more clues about the state of the economy from the release of JOLTS job opportunities, ADP employment, and jobless claims. 

We are getting closer to January 20, the day Donald Trump will assume office as president. 

In my opinion, next year his aggressive economic policies will have an impact on the US Dollar, which will weaken the USD against major currencies that will make them stronger against the USD. 

In addition to threatening China and Europe with tariffs, Trump has also called on other nations to follow suit. Since both the Eurozone and the UK economy are facing significant economic difficulties, they are also facing similar challenges.

He has discussed trade issues with Canada and Mexico. As a result, the market is anxiously awaiting the decision of the incoming administration. 

Meanwhile, on Friday, Japan's headline inflation jumped to 2.6% and core inflation jumped to a startling 2.2% versus the estimates of 2%, increasing the likelihood that the Bank of Japan will hike interest rates sooner than anticipated.

The release of the CPI figures caused the Yen to jump strongly. 

While in December, I believe that the market will continue to be unstable. Gold could move in a wider range of directions and the US Dollar could have a weaker tone.

#GOLD @ $ 2653.50- is heading for another volatile week. The key resistance level is $ 2674, and break risks for $ 2688. However, a downside break of $ 2636-38 risks for $ 2608 or probably $ 2586.

#EURO @ 1.0580- Support 1.0465-75 should hold for upside test of 1.0660-70 zones. However, if it does not rise over 1.0720, another decline is likely.

#GBP @ 1.2742- Cable may gain at first, but it is unlikely to get past resistance between 1.2820-50. Protection on the downside is around 1.2610-20. The break will push it towards 1.2540.

#JPY @ 149.70-USD will need to clear 150.98 for 151.70, which appears to be difficult. The downside risk will rise if 148.70 is broken for 147.90.

The writer is the former Country Treasurer of Chase Manhattan Bank

Disclaimer: The views and analysis in this article are the opinions of the author and are for informational purposes only. It is not intended to be financial or investment advice and should not be the basis for making financial decisions.