The AUDUSD pair fell sharply on Thursday, then settled slightly lower than 0.67 on Friday. Analysts at Danske Bank predicted that the pair is likely to keep sliding in the coming months. Thus, AUDUSD may reach 0.66 in three months, and then hit 0.65 in half a year.
According to ANZ Bank economists’ forecasts, the gold price will rise to $1,900 by the end of next year.
The EURUSD climbed to 1.07 after the European Central Bank (ECB) delivered its interest rate hike. Economists at Nordea expect EURUSD to go up to 1.10 over the next month. In their views, it will hover around 1.13 by the end of 2023.
The USDJPY currency pair ended last week hovering around 136.70. Analysts at Danske Bank predict that USDJPY at 137 by mid-January and at 139 in three months. In a year, it could drop to 128.
On Thursday, December 15, the European Central Bank (ECB) increased its interest rate for the fourth time in a row. This time, it rose by 50 basis points. The bank also outlined its intention to start reducing the balance sheet from next March.
The growth rate of the U.S. dollar has been driven by the pace and size of interest rate increases. According to economists at ANZ Bank, the dominance of the U.S. dollar is coming to an end.
On Thursday, the US dollar rose sharply. The greenback's growth was triggered by investors’ concern about the coming recession in view of the Fed's announcement on raising interest rates next year.
According to the forecasts of Danske Bank economists, the euro/dollar pair is expected to fall next year.
Expectations of specialists and market participants came true — the Bank of England increased Bank Rate by 50 basis points to the level of 3.50%. Thus, the pound sterling is left without much support from the British central bank, according to a report by TD Securities economists.
According to strategists at ANZ Bank, gold prices tend to remain under downside pressure ahead of an economic downturn. However, recessions usually move gold prices up and make gold perform inversely to other markets, such as the stock market.
