The Market Brief

Friday’s session, which capped off a week of trading on international markets, brought investors real madness on the precious metals market.

– SILVER broke through the $100 per ounce barrier for the first time in history and continued to rise to over $101. In intraday terms, the increases reached over 5%. 

– The situation with gold is also very interesting.  Although GOLD is growing less in percentage terms, by “only” 0.7%, it also gave hope for a while that it would break through the USD 5,000 barrier. However, the increases have stopped and at the moment the price is stabilizing at close to USD 4,970 per ounce. 

Such significant increases on the precious metals market were possible today thanks to the weakness of the dollar, which is losing ground against most of the world’s key currencies, but is falling most sharply against the Japanese yen.

– The Japanese currency gained ground from the start of the day, but the main appreciation against the USD occurred in the evening and followed a linear pattern with a sharp jump in volume, which was hailed in the media as a possible currency intervention.  Unfortunately, we cannot confirm this information at this time, but the dynamics of the latest movement were similar to those in the morning, when there was also speculation about the possibility of intervention due to the large volume. 

– The chance for real appreciation may also be supported by the weak USD, which means that the “artificial” strengthening of the domestic currency in the case of the Japanese may cost less in this case. Another favorable argument was the very fact of the BoJ’s decision, which increased market liquidity.

– The Bank of Japan kept interest rates unchanged, with the main interest rate at 0.75%. On the other hand, the bank’s projections for growth and inflation appear to be very hawkish. The bank raised its GDP growth forecasts for fiscal years 2025-2026 to around 0.9-1.0% and significantly raised its core inflation path, especially “core-core” inflation, which is expected to remain above 2% until fiscal year 2027.

– In Germany today, industrial and service indicators performed better than expected. In France, the service sector showed weaker data, which dampened positive sentiment. Across the eurozone, PMI indicators confirmed moderate expansion, although the pace of growth in services slowed compared to earlier readings.

– Shortly after trading began, we also learned the PMI data for the US economy. Preliminary PMI data for the US for January indicate further growth in economic activity, albeit slightly weaker than market expectations. The industrial index stood at 51.9 against a forecast of 52.0, suggesting a moderate but stable pace of expansion in the manufacturing sector. The PMI for services fell slightly to 52.5, compared to expectations of 52.8, showing a slight weakening in demand in most parts of the economy. In turn, the composite index rose to 52.8 from 52.7 in December, confirming the overall resilience of the economy at the beginning of the year. The data indicate that the US private sector is continuing to expand, although the momentum of growth is beginning to normalize somewhat.

– Bloomberg reported that China’s state regulator has tentatively allowed the country’s three largest technology companies, Alibaba, Tencent, and ByteDance, to begin talks on importing H200 AI chips. Following the reports, the company’s shares managed to return above the EMA50 average (orange line), which is around $187 per share.

– Wall Street is currently showing mixed results. Only the Nasdaq is seeing gains, but these do not exceed 0.3%. The other indices are trading below par.

– The aforementioned yen and British pound are currently performing best on the FX market. The USD and NZD are losing the most.

– Despite the rollover of the NATGAS futures contract, it is gaining in value, as evidenced by the rebound from the opening price after the rollover. Weather forecasts indicate that cold temperatures will continue. New meteorological data will be available after the weekend. 

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