NAGA Weekly Recap December 11 - 2023 – December 15 - 2023

Welcome to our economic recap, where we delve into how major assets like $EURUSD, $GBPUSD, Dow Jones, Nasdaq, and $FTSE100 have been impacted by significant releases, including key rate decisions in the USA, Europe, and the UK, among other updates. Read on for detailed insights below 👇

World's major central banks decide on key interest rates

On Wednesday, December 13, and Thursday, December 14, the world's largest economies announced their decisions on key interest rates. The U.S. Federal Reserve maintained its rate at 5.50% but indicated a planned reduction in the first quarter of 2024. The Bank of England also kept its rate steady at 5.25%. Similarly, in Europe, the rate remained unchanged at 4.5%, with signals that it is not expected to decrease in the near future.

These decisions marked the end of 2023 and symbolized the conclusion of the rate hike cycle that began between 2019 and 2020, when global economies needed strengthening due to the COVID-19 pandemic.

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Adobe stock drops after earnings

Adobe Inc.'s ($ADBE) shares declined by 6% in after-hours trading following its revenue forecast for the next year, which fell short of analysts' expectations. Despite reporting a 19% increase in earnings and a 12% rise in sales year-over-year, with adjusted earnings of $4.27 per share on sales of $5.05 billion surpassing expectations, the software company's weak outlook caused a downturn in its stock value. Before the earnings release, Adobe's shares were trading at $620, but have since dropped to $585.

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Oil prices could break a 7-week losing streak

Crude oil prices experienced a surge early Friday as a blend of increasing demand optimism and escalating geopolitical risks contributed to the upward momentum. This trend positions oil prices to potentially break a seven-week losing streak.

Adding to this bullish sentiment, the International Energy Agency's latest monthly report inadvertently boosted OPEC's stance by revising its 2024 oil demand forecasts upward, indicating a more robust demand than previously anticipated.

In early Friday trading, West Texas Intermediate ($WTI) saw a rise of 0.24%, reaching $71.75, while Brent crude edged up 0.26%, trading at $76.81.

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EUR/USD surges, nearing 1.1000 mark following ECB's hawkish verdict

On Thursday, the European Central Bank (ECB) kept its rates unchanged for the second consecutive meeting and began discussions on exiting the PEPP bond-buying program, expected to start after the first half of 2024. Euro (EUR) holders welcomed the central bank's decision, as evidenced by the sharp rise in the $EURUSD pair to 1.0990, although it fell short of reaching the 1.1000 mark.

As a result, traders scaled back their expectations for ECB rate cuts in 2024, following ECB President Christine Lagarde's statement that there were no discussions about easing monetary policy. She added that rates could remain at their current level at least through the first half of 2024, pushing back speculations of rate reductions to a later date.

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This concludes our weekly recap. Have a great weekend and see you next week! 👋