China Evergrande Group is the world’s most indebted real estate developer, with more than $ 300 billion in liabilities. It announced that it made initial progress in resuming construction works and its president promised to deliver 39,000 units of properties in December, compared with fewer than 10,000 in each of the previous three months. It is struggling to repay bondholders, banks, suppliers, and deliver homes to buyers, personifying a bloated industry suffering from the Chinese government’s deleveraging campaign.
From the west, it appears that American consumption in US retail sales increased 8.5% during this year’s Christmas shopping season, from November 1 to December 24, driven by growing e-commerce sales. E-commerce sales in the United States increased 11% in this year’s holiday shopping season. The role of the COVID-19 pandemic in transforming customer shopping habits is highlighted once again.
The international currency market remained unchanged within days of closing the last months of the year. EURUSD remained below monthly highs unchanged. Buyers in euro have not yet managed to position the currency above 1.1350, however the lows have been exceeded since last week. The preference is mixed, below 1.1300 we go for sell. Buys are reserved for confirmation on 1.1330 to 1.1340. GBPUSD managed to overtake the falls of Europe by Omicron and is trading above 1.34. The preference is buyer, the 1.3450 is pending, a price above which we will have 1.35 for the coming week.
USDJPY did not show variations in the week. The cross continues to consolidate above 114.30 to 114.50. Buy preference over 114.50, otherwise we will expect take profit below 114.20. USDCAD remains lower in the market, the preference is short below 1.28. The market could open with news tomorrow, Monday, December 27, given the loss of thousands of international American flights and partial closures of trade in the United States. The cross continues to test the 1.2830 and 1.2820 levels. USDCHF remains lower without achieving a position above 0.92 at the end of the month. Current levels are minimal in the market area with high buyer potential. Strategically, sell is preferred below 0.92.
Commodities of metal gold and silver had a buyer performance in the last day without exceeding the highs of December. In gold, the market take profit remains below 1815.0 and 1812.0, at the moment the market is bought, although we could have new highs entering the month of January 2022. It will depend on the control of the Omicron variant in the world. In silver, the market closed buyer although without passing the levels of 23.0. Like gold, the December high could be left behind in January exceeding 23.0.
Inflation will be the most relevant data for the month of January 2022 and therefore the future performance of the foreign exchange market will depend on how much can be controlled. From its tipping point in February 2021 to last month, the US consumer price index has grown 6%, an annualized rate of 8%. The underlying cause is no mystery. As of March 2020, the US government created around $ 3 trillion of new bank reserves (an equivalent of cash) and sent checks to individuals and businesses. The total stimulus amounts to about 25% of GDP and about 30% of the original federal debt. While much of the money went to help people and companies severely affected by the pandemic.
Finally cryptocurrencies are back on the investment table. Bitcoin managed to exceed 50,000, new buys are estimated to exceed 51,900 until finally 53,600. Ethereum remains buy and is estimated to reach 4215.0 for next week.