Technical Outlook and Review

IC Markets

Commodity

Cryptocurrency

Forex

Summary:

The DXY (US Dollar Index) chart currently displays a bearish overall momentum, suggesting the potential for a bearish reaction off the 1st resistance level, followed by a drop towards the 1st support.

DXY

The 1st support at 103.56 is identified as an overlap support and also coincides with the 50% Fibonacci Retracement level. This confluence suggests that it could act as a significant level of support, where traders may expect the price to find buying interest or experience a pause in the bearish movement.

The 2nd support at 102.82 is categorized as an overlap support and coincides with the 61.80% Fibonacci Retracement level. This level further reinforces its potential as a support level, given the confluence of technical factors.

On the resistance side, the 1st resistance at 104.01 is noted as a pullback resistance. This level indicates a potential barrier to further upward movement, where selling interest may emerge.

The 2nd resistance at 105.94 is identified as an overlap resistance, suggesting another potential level where the price may encounter selling pressure during its bearish reaction.

EUR/USD

The EUR/USD chart currently exhibits a bearish overall momentum, indicating the potential for a bearish continuation towards the 1st support level.

The 1st support at 1.0764 is considered a pullback support level. This level suggests a potential area of support where traders may anticipate the price finding buying interest or experiencing a pause in its bearish movement.

The 2nd support at 1.0663 is categorized as an overlap support level. Overlap supports often carry significance as they represent areas where the price has previously found support, making it a relevant level to watch for potential price reactions.

On the resistance side, the 1st resistance at 1.0884 is identified as a multi-swing high resistance level. This level indicates a potential barrier to further upward movement, where selling interest may emerge.

The 2nd resistance at 1.0943 is characterized as a swing high resistance level. Swing highs often act as points of resistance, further reinforcing the potential for a bearish continuation.

EUR/JPY

The EUR/JPY chart currently exhibits a bearish overall momentum, suggesting the potential for a bearish reaction off the 1st resistance level and a subsequent drop towards the 1st support.

The 1st support at 160.40 is identified as an overlap support, indicating a price level where historical trading activity has occurred. It may act as a level where buyers could potentially step in or where selling pressure may decrease.

On the resistance side, the 1st resistance at 164.08 is categorized as a multi-swing high resistance. This level signifies an area where the price has faced significant selling pressure in the past, making it a relevant resistance level.

EUR/GBP

The EUR/GBP chart currently demonstrates a bearish overall momentum, indicating the potential for a bearish reaction off the 1st resistance level, followed by a drop towards the 1st support.

The 1st support at 0.8713 is identified as an overlap support, signifying a historical price level where trading activity has occurred. It may act as a level where buyers could potentially step in or where selling pressure may decrease.

The 2nd support at 0.8664 is considered a multi-swing low support, reinforcing its significance as a support level. Multi-swing lows often indicate areas where buyers have intervened previously, making it a relevant support level.

On the resistance side, the 1st resistance at 0.8745 is categorized as a swing high resistance. This level represents a point where the price has encountered significant selling pressure in the past, making it a notable resistance level.

The 2nd resistance at 0.8771 is noteworthy as it is associated with both the 78.60% Fibonacci Projection and the 127.20% Fibonacci Extension. This indicates a potential Fibonacci confluence, suggesting a strong resistance barrier.

GBP/USD

The GBP/USD chart currently has a bearish overall momentum, suggesting the potential for a bearish break off the 1st support level, followed by a drop towards the 2nd support level.

The 1st support at 1.23979 is identified as a pullback support and coincides with the 38.20% Fibonacci Retracement level. This level suggests a potential area of support where traders may expect the price to find buying interest or experience a pause in the bearish movement.

The 2nd support at 1.23185 is also categorized as a pullback support and coincides with the 61.80% Fibonacci Retracement level. It further reinforces its potential as a support level, indicating another relevant area where buyers may step in.

On the resistance side, the 1st resistance at 1.2499 is described as a swing high resistance and also coincides with the 127.20% Fibonacci Extension level. This level suggests a potential barrier to further upward movement, where selling interest may emerge.

GBP/JPY

The GBP/JPY chart currently exhibits a bearish overall momentum, suggesting the potential for a bearish continuation towards the 1st support level.

The 1st support at 185.77 is identified as a pullback support. This level signifies a point where the price may find buying interest or a temporary pause in the bearish movement. It is a level to watch for potential support.

The 2nd support at 184.25 is also a pullback support, reinforcing its significance as a potential level of support. Pullback supports are areas where buyers have previously stepped in, making them relevant support levels.

On the resistance side, the 1st resistance at 188.15 is categorized as a swing high resistance. This level represents a point where the price has encountered significant selling pressure in the past, making it a notable resistance level.

USD/CHF

The USD/CHF chart currently shows a neutral overall momentum, suggesting that price could potentially fluctuate between the 1st resistance and 1st support levels.

The 1st support at 0.8861 is considered a pullback support level, and it also coincides with the 127.20% Fibonacci Extension, making it a significant level to watch. This level may act as a potential area of support where traders could expect buying interest or a pause in downward movement.

The 2nd support at 0.8766 is categorized as a multi-swing low support and is further reinforced by the 161.80% Fibonacci Extension. Multi-swing lows often indicate areas where buyers have previously stepped in, making it a relevant support level.

On the resistance side, the 1st resistance at 0.8904 is identified as a pullback resistance. This level suggests a potential area where selling interest may emerge, potentially leading to a pause or reversal in the upward movement.

The 2nd resistance at 0.8961 is also characterized as a pullback resistance, reinforcing the potential for a price reversal or a barrier to further upward movement.

USD/JPY

The USD/JPY chart currently exhibits a bullish overall momentum, suggesting the potential for a bullish continuation towards the 1st resistance level.

The 1st support at 150.26 is identified as an overlap support, and it also coincides with the 61.80% Fibonacci Retracement level. This level indicates a significant area of potential support, where traders may expect buying interest or a pause in the upward movement.

The 2nd support at 149.28 is considered a swing low support, further reinforcing its potential as a support level. Swing lows often signify areas where buyers have stepped in previously, making it a relevant support level.

On the resistance side, the 1st resistance at 151.71 is categorized as a multi-swing high resistance. This level suggests that there may be selling interest in this area, potentially acting as a barrier to further upward movement.

The 2nd resistance at 152.66 is noted as a level associated with the -27% Fibonacci Extension, indicating another potential area where the price may encounter selling pressure during its bullish continuation.

USD/CAD

The USD/CAD chart currently shows a weak bullish momentum, indicating the potential for further upside movement towards the 1st resistance.

The 1st resistance level at 1.3745 is identified as a pullback resistance. Higher up, the 2nd resistance level at 1.3826 is marked as an overlap resistance, highlighting a potential barrier against further upward momentum.

To the downside, the intermediate support at 1.3657 is identified as an overlap support while the 1st support level at 1.3607 is also marked as an overlap support. Further below, the 2nd support level at 1.3523 is noted as a pullback support.

AUD/USD

The AUD/USD chart currently exhibits an overall bearish momentum, suggesting the potential for a bearish continuation towards the 1st support.

The 1st support level at 0.6455 is identified as a pullback support that aligns close to the 50.00% retracement level. Further below, the 2nd support level at 0.6393 is marked as an overlap support, suggesting a significant support level.

To the upside, the 1st resistance level at 0.6517 is identified as a multi-swing-high resistance. Higher up, the 2nd resistance level at 0.6587 is marked as a pullback resistance, suggesting that it could serve as a strong resistance level.

NZD/USD

The NZD/USD chart currently exhibits an overall bearish momentum, suggesting the potential for a bearish continuation towards the 1st support.

The 1st support level at 0.5939 is identified as a pullback support. Further below, the 2nd support level at 0.5859 is noted as an overlap support, signifying its significance as a strong support area.

To the upside, the 1st resistance level at 0.5999 is identified as a pullback resistance while the 2nd resistance level at 0.6049 is marked as a multi-swing-high resistance, indicating its potential strength as a barrier to further bullish movement.

DJ30

The DJ30 chart is currently showing an overall bearish momentum, with price making a bearish reaction off the 1st resistance and potentially make a bearish continuation towards the 1st support.

The 1st resistance level at 35073.60 is marked as an overlap resistance. Higher up, the 2nd resistance level at 35366.48 is noted as a pullback resistance, indicating a potential resistance area for further upward movement.

On the support side, the 1st support level at 34755.26 is identified as a pullback support. Further below, the 2nd support level at 34408.91 is noted as an overlap support, marking another potential level for a strong support area.

GER40

The GER40 chart is currently displaying an overall bearish momentum, with price making a bearish reaction off the 1st resistance and potentially make a bearish continuation towards the 1st support.

The 1st resistance level at 15760.40 is marked as a pullback resistance that aligns close to the 127.20% Fibonacci extension level. Higher up, the 2nd resistance level at 15985.10 is noted as a swing-high resistance, indicating a potential resistance area for further upward movement.

On the support side, the 1st support level at 15559.50 is identified as a pullback support. Further below, the 2nd support level at 15330.50 is noted as an overlap support, marking another potential level for a strong support area.

US500

The US500 chart is currently indicating an overall bearish momentum, with price making a bearish reaction off the 1st resistance and potentially make a bearish continuation towards the 1st support.

The 1st resistance level at 4515.30 is marked as a pullback resistance. Higher up, the 2nd resistance level at 4595.80 is also noted as a pullback resistance, indicating a potential resistance area for further upward movement.

On the support side, the 1st support level at 4393.20 is identified as an overlap support. Further below, the 2nd support level at 4329.90 is also noted as an overlap support, marking another potential level for a strong support area.

BTC/USD

The BTC/USD chart currently exhibits a bearish overall momentum, suggesting the potential for a bearish reaction off the 1st resistance level and a drop towards the 1st support.

The 1st support at 35,629 is identified as a pullback support. This level indicates a point where buyers may step in or where a temporary pause in the bearish movement could occur. It is a level to watch for potential support.

The 2nd support at 31,761 is also a pullback support, reinforcing its significance as a potential support level. Pullback supports often indicate areas where buyers have previously intervened, making them relevant support levels.

On the resistance side, the 1st resistance at 37,853 is categorized as a swing high resistance. This level represents a point where the price has previously encountered significant selling pressure, making it a notable resistance level.

The 2nd resistance at 38,820 is noted as the 127.20% Fibonacci Extension level, which suggests a potential barrier to further upward movement

ETH/USD

The ETH/USD chart currently demonstrates a bearish overall momentum, suggesting the potential for a bearish continuation towards the 1st support level.

The 1st support at 1,865.40 is identified as an overlap support. This level indicates a potential area where buyers may show interest or where a pause in the bearish movement could occur. It is a key level to watch for potential support.

The 2nd support at 1,737.54 is also an overlap support and coincides with the 61.80% Fibonacci Retracement level. This adds to its significance as a potential support level. Fibonacci retracement levels are commonly used by traders to identify key support and resistance areas.

On the resistance side, the 1st resistance at 2,125.26 is categorized as a multi-swing high resistance. This level represents a point where the price has previously faced notable selling pressure, making it an important resistance level to monitor. Technical Outlook and Review_16

WTI/USD

The WTI (West Texas Intermediate) chart currently shows an overall bearish momentum, suggesting the potential for a bearish continuation towards the 1st support.

The 1st support level at 75.34 is identified as a pullback support. Further below, the 2nd support level at 73.82 is noted as an overlap support that aligns with the 127.20% Fibonacci extension level, signifying its potential as a strong support area.

To the upside, the 1st resistance level at 79.29 is identified as a swing-high resistance. Higher up, the 2nd resistance level at 81.77 is marked as an overlap resistance, suggesting potential strength as a barrier to further bullish movement. Technical Outlook and Review_17

XAU/USD (GOLD)

The XAUUSD (Gold) chart currently exhibits a bullish overall momentum, suggesting the potential for a bullish bounce off the 1st support level and a movement towards the 1st resistance.

The 1st support at 1953.25 is identified as a pullback support, indicating a potential level where buyers may step in. It signifies a price area where the market has previously found support during a pullback.

The 2nd support at 1932.77 is considered an overlap support, further reinforcing its potential as a support level. Overlap supports often indicate areas where price reversals or bounces may occur.

On the resistance side, the 1st resistance at 1975.18 is categorized as an overlap resistance. This level suggests that there may be selling interest in this area, potentially acting as a barrier to further upward movement.

The 2nd resistance at 1992.48 is also noted as an overlap resistance, indicating another potential area where the price may encounter selling pressure during its bullish movement. Technical Outlook and Review_18

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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TD Securities

Commodity

Crude Oil Price Technical Analysis

In the past few days, Crude oil prices saw a steady decline amid the Israel-Hamas war. The price declined toward the $75.00 zone before the bulls appeared. Crude Oil Price at Risk of More Downsides, Gold Turns Green_1

Crude Oil Price at Risk of More Downsides, Gold Turns Green_1

Looking at the 4-hour chart of XTI/USD, the price settled below the $80.00 pivot level, the 200 simple moving average (green, 4-hour), and the 100 simple moving average (red, 4-hour).

A low was formed near $75.25 and recently the price started an upside correction. There was a move above the $77.50 resistance zone. However, the price failed to clear the $78.80 resistance zone. It struggled near the 23.6% Fib retracement level of the downward move from the $90.96 swing high to the $75.25 low.

There is also a key bearish trend line forming with resistance near $78.80 on the same chart. The next major resistance is near the $81.20 zone or the 38.2% Fib retracement level of the downward move from the $90.96 swing high to the $75.25 low, above which the price may perhaps accelerate higher.

In the stated case, it could even visit the $83.20 resistance or the 200 simple moving average (green, 4-hour) in the coming days.

If not, the price might continue to move down. Immediate support is near the $75.80 level. The next support is at $75.00, below which there is a risk of a sharp decline. In the stated case, the price could dive toward the $72.50 support. Any more losses might call for a test of the $70.00 support zone.

Looking at gold prices, there was a consolidation phase near the $1,960 level and the bulls might now aim for more upside.

Economic Releases to Watch Today

US Initial Jobless Claims – Forecast 220K, versus 217K previous.

Risk Warnings and Disclaimers

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Samantha Luan

Economic

Central Bank

Forex

Australian Dollar weakens broadly in Asian session, as Australian employment data and shifting global risk sentiment take center stage. The mixed nature of the latest Australian jobs report is causing a rethink among investors regarding RBA's next steps. Despite robust increase in overall employment numbers, a nuanced look reveals cracks in the job market's strength.

The unexpected uptick in the unemployment rate and deceleration in work hours growth are clear indicators of a cooling labor market. This cooling trend reinforces expectation for RBA to hit pause on its interest rate hikes again in December meeting. RBA is likely to closely monitor the economic indicators over the festive season to gauge the need for further monetary policy adjustments in February.

Australian Dollar's descent is also exacerbated by a cooling of risk-on sentiment that had buoyed the global markets earlier in the week. Investors are seemingly taking a breather and reassessing their positions. A key event that has captured the market's attention is the meeting between US President Joe Biden and Chinese President Xi Jinping, which occurred on the sidelines of APEC summit. Although the meeting marked a step forward in re-establishing high-level military communications, it fell short of offering substantial breakthroughs in broader geopolitical tensions. The absence of a new defense minister appointment in China, following the unexplained dismissal of Gen. Li Shangfu, adds to the air of uncertainty affecting market sentiment.

In the broader currency spectrum, New Zealand Dollar is joining Australian Dollar as one of the day's weakest performers so far, alongside British Pound and Canadian Dollar. On the flip side, Japanese Yen is emerging as the strongest currency for the day at this point, with t Dollar and Swiss Franc also showing resilience. Euro's performance remains uneven across different pairings.

Despite the daily fluctuations, when looking at the weekly performance, Dollar continues to be at the bottom of the league, with Japanese Yen and Canadian Dollar also underperforming. Australian and New Zealand Dollars, along with Swiss Franc and Euro, are experiencing the strongest gains, whereas British Pound exhibits mixed results across the board.

Technically, EUR/USD turned into consolidation after surging to 1.0886 earlier in the week. Some consolidations would be seen in the near term, but outlook will stay bullish as long as 1.0755 resistance turned support holds. Above 1.0886 will resume the rebound from 1.0447 to 61.8% retracement of 1.1274 to 1.0447 at 1.0958. Upside momentum will likely start to wane above 1.0958 fibonacci level. But any acceleration above there could be an early signal of more intense selloff in Dollar elsewhere.

Aussie Dips Amid Mixed Employment Data and Global Market Cautiousness_1

In Asia, Nikkei closed down -0.27%. Hong Kong HSI is down -1.11%. China Shanghai SSE is down -0.49%. Singapore Strait Times is up 0.11%. Japan 10-year JGB yield is down -0.002 at 0.795. Overnight, DOW rose 0.47%. S&P 500 rose 0.16%. NASDAQ rose 0.07%. 10-year yield rose 0.094 to 4.535.

Fed's Daly cautions against premature end to rate hikes, emphasizes need for patience

San Francisco Fed President Mary Daly, in an interview with the Financial Times, acknowledged the "very, very encouraging" signs of falling inflation in this week's data. However, she cautioned against hastily concluding the rate-raising cycle, emphasizing the importance of a cautious and informed approach.

Daly expressed concern about prematurely ending the cycle, noting the potential risks involved. "We have to be bold enough to say 'we don't know' and bold enough to say 'we need to take the time to do it right'," she stated. She warned that a premature halt could lead to a 'stop-start' scenario, which could ultimately harm the Fed's credibility.

In her view, rate cuts are not on the immediate horizon. "Rate cuts are 'not happening for a while'," Daly remarked, suggesting a continued commitment to the current restrictive monetary policy direction until there is substantial evidence of a sustainable return to the 2% inflation target.

Australia's employment grows 55k, yet signs of cooling emerge

Australia's labor market displayed stronger-than-anticipated performance in October, with employment figures surpassing expectations. The economy added 55k jobs, well above forecasted growth of 22.8k. This increase was driven by both full-time and part-time employment, which rose by 17k and 37.9k respectively.

Despite this robust job growth, unemployment rate edged up slightly from 3.6% to 3.7%, aligning with market expectations. Pparticipation rate also saw an uptick, rising by 0.2% to 67.0%. Additionally, month-over-month hours worked in the economy increased by 0.5%.

Bjorn Jarvis, ABS head of labour statistics, noted that over the past two months, this equates to an average monthly employment growth of approximately 31k people, slightly lower than average growth of 35k people a month since October 2022.

He also highlighted that annual growth rate in hours worked has slowed to 1.7%, down from around 5% mid-year, and lower than annual employment growth of 3.0%. This slowdown may suggest that "the labour market is starting to slow, following a particularly strong period of growth."

Japan's exports increase for second month, despite persistent decline in China shipments

In October, Japan experienced a mixed bag in its trade sector. Exports saw a modest rise of 1.6% yoy to JPY 9167B, marking the second consecutive month of growth, albeit at a slower pace compared to September's 4.3% yoy increase.

One notable aspect was the continued decline in shipments to China, which fell by -4.0% yoy. This marks the eleventh consecutive month of decline, underscoring the strained trade relations and potentially shifting economic alliances in the region.

Conversely, exports to the US surged by 8.4% yoy, buoyed by robust demand for hybrid vehicles and mining and construction machinery. This surge propelled the value of U.S.-bound shipments to record levels. Similarly, exports to Europe experienced a healthy increase of 8.9% yoy, indicating diversified trade relations.

On the import front, Japan witnessed a significant drop of -12.5% yoy to JPY 9810B. The trade balance resulted in a deficit of JPY -663B.

Looking at seasonally adjusted terms, both exports and imports saw month-on-month declines, with exports decreasing by -1.2% mom to JPY 8800B and imports falling by -0.7% mom to JPY 9262B. Consequently, trade deficit widened from September's JPY -420B to JPY -462B.

Looking ahead

The European economic calendar is empty today. Canada will release housing starts in North American session. US will release jobless claims, Philly Fed survey, and industrial production.

AUD/USD Daily Report

Despite spiking higher to 0.6541, subsequent retreat in AUD/USD suggests that a temporary top was formed. Intraday bias is turned neutral for some consolidations first. Downside should be contained by 55 4H EMA (now at 0.6427) to bring rebound. Break of 0.6541, and sustained trading above 38.2% retracement of 0.6894 to 0.6269 at 0.6508, will argue that whole corrective fall from 0.7156 has completed with three waves down to 0.6269. Stronger rally should seen to falling channel resistance (now at 0.6684) next.

Aussie Dips Amid Mixed Employment Data and Global Market Cautiousness_2

In the bigger picture, there is no confirmation that down trend from 0.8006 (2021 high) has completed. While current rebound from 0.6269 might extend higher, it could be the third leg of the corrective pattern from 0.6169 (2022 low) only. For now, medium term bearishness will remain as long as 0.6894 resistance holds.

Source: ActionForex

To stay updated on all economic events of today, please check out our Economic calendar

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Owen Li

Palestinian-Israeli conflict

Economic

The solar energy company Sunbox paid its 15 full-time employees in Gaza this month. But next month is uncertain: The company's main offices in Gaza City were destroyed in an Israeli strike, said Kamal Almashharawi, 24, the company's head of operations.

The devastation of Gaza's infrastructure has only increased the need for solar panels. Almashharawi and others say that Israeli strikes have damaged or destroyed many rooftop solar arrays — among the few sources of power in Gaza as fuel runs out.

But with its office obliterated, its revenue cut and its employees sheltering from Israeli bombardments, the company, like most in the Gaza Strip, has bleak prospects in the months ahead.

Gaza's economy already was crumbling. The war has pounded it to dust. "I don't really see any light at the end of the tunnel," Almashharawi said.

For the better part of two decades, economic growth in Gaza was close to stagnant amid regular conflict and Israeli restrictions on the movement of people and goods. Hamas, the militant group that has controlled the territory since 2007, often focused on military aims. With little outside investment and few jobs, living standards dropped as Gazans became poorer. Last year, 80 percent of the population relied on international aid, according to a United Nations estimate. The World Bank projected "nominal" GDP growth in 2023, driven by coronavirus pandemic recovery and more job permits for Gazans to work in Israel.

Most of whatever economic activity persisted has ground to a halt amid Israel's response to the Hamas-led attack on Oct. 7. Bombardments and a ground invasion have left more than 11,100 Palestinians dead, according to the Gaza Health Ministry. Some 1.5 million people — much of the population of Gaza — have been displaced, according to the United Nations. "Gaza's economy ceased to function as of the last quarter of 2023, and will continue to be so indefinitely," read a statement this month from the Palestine Economic Policy Research Institute, based in Ramallah, in the West Bank.

Making accurate or final estimates of economic damage remains impossible. Israel has closed it borders with Gaza. A trickle of aid has entered across Gaza's border with Egypt.

Palestinian authorities in Ramallah have said that Gaza's economic output is running at 10 percent. "If anything, it's a subsistence-type economy," said Raja Khalidi, the director general of the Palestine Economic Policy Research Institute.

The U.N. Development Program published a report this month estimating that 61 percent of jobs in Gaza had been lost, along with $857 million of economic activity, setting the economy back "by many years."

Although Gaza has a long history of conflict, there are no parallels to the scale of the present devastation. Some Palestinian officials put the economic cost of Israel's ground operation in Gaza in 2014 at more than $6 billion. The current war is already longer and far more destructive.

"We haven't reached bottom yet," said Richard Kozul-Wright, who is the lead author of a report on Gaza's economy published by the U.N. Conference on Trade and Development that was published in September.

After the violence subsides, the economic future of Gaza's 2.4 million residents will be another line of battle. An economically viable Gaza is widely considered a prerequisite for any lasting peace. Some experts say that the pressure placed on Gaza in the years before Oct. 7 had increased support for Hamas.

But many in Israel say instead that the country had become too lenient with Gaza's economy, allowing Hamas to enrich itself.

Charles Freilich, a former deputy national security adviser in Israel, said that many in Israel felt that the small but increasing level of economic cooperation with Palestinians living in Gaza had proved to be an "overall failure."

From bad to worse

Experts say that Gaza, with its coastal location, arable land and young population, could have a productive, even thriving, economy.

As recently as a few decades ago, some Israeli economists had hoped that Gaza could follow in the steps of Singapore, "very small," but "with a few million people who are young who are either now or will be very educated," said Paul Rivlin, an expert on Middle Eastern economies at Tel Aviv University. "It didn't happen."

Per capita income in Gaza is a quarter of that in the West Bank, according to the International Monetary Fund. That gap has widened significantly since 2005, when Israel withdrew militarily from Gaza, and since Hamas took power.

Israel tightly controls its borders with Gaza, limiting exports from the enclave and restricting its imports, citing concerns over the import of "dual use" goods that could be directed into weaponry.

The restrictions hit hard. Only 40 percent of the population that could work did so in 2021, according to the International Labor Organization. The Hamas-run civil sector employed roughly 50,000 people, about a tenth of Gaza's estimated labor force.

Earlier this year, the Gaza-based Al Mezan Center for Human Rights reported that the number of people employed in construction had dropped from 70,000 before the restrictions to 700 — despite Gaza's booming population. The war will make housing needs more acute. "It took four years of conflict in Syria to destroy a comparable share of housing stock," said Abdallah Al Dardari, UNDP director for Arab states.

Although Egypt imposed fewer economic restrictions on its border with Gaza, Rivlin said, it's "a long way from the center of the Egyptian economy."

In 2014, after a rift with Hamas, the Egyptian government destroyed most of the smuggling tunnels between Gaza and Egypt — a key source of black-market income, and funding for Hamas.

Kozul-Wright said Gaza was not a "functioning economy" before the present war.

Some economists have said the Palestinian territories, and Gaza in particular, have experienced "de-development" or "development in reverse," with the population increasingly reliant on diminishing aid.

In 2020, UNCTAD estimated that the total economic loss for Gaza between 2007 and 2018 was $16.7 billion.

Little hope

Satellite imagery shows that huge Gaza neighborhoods have been destroyed since last month, including areas of Gaza City once known for commercial activity.

Israel has rescinded the permits of Palestinians who had worked in the country, and those who were in Israel have been deported. Strict sanctions have made sending cash to Gaza difficult, and aid has become scant.

In 2021, the Israeli government began a process that would allow 17,500 Gazans to work in Israel. Although most who applied did not receive permits and those who did represent a tiny fraction of Gaza's workforce, the program still was a break from the past.

Israel allowed money from Qatar — tens of millions of dollars a month — to flow to Gaza, in part so that Hamas could keep the government functioning.

Even before Oct. 7, some Israelis were raising questions about the wisdom of these policies. The veteran military journalist Amos Harel wrote in Haaretz barely a week before the attack that the notion that Gazans could pressure Hamas into economic improvements was a "false idea."

Critics say that Hamas was never focused on improving economic conditions for those in Gaza, many of whom it classifies as refugees and thus the responsibility of the United Nations. The group appears to have used much of its funds to build a vast network of tunnels.

The U.S. Treasury has sharply tightened sanctions on Hamas, accusing its leaders of living "in luxury" while Gazans face "dire economic prospects."

Freilich, the former Israeli deputy national security adviser, said it was clear that Israel would no longer permit people from Gaza to work in the country.

"There will be an attempt to end any Israeli involvement and responsibility for providing electricity, water and things like that," he said, referring to the services that Israel has provided under the 1993 Oslo accords.

U.S. Secretary of State Antony Blinken this month that any peace agreement "must include a sustained mechanism for reconstruction." The Palestine Economic Policy Research Institute estimated this month that the cost of rebuilding could reach $20 billion over the next five years.

Gaza's economy could shrink by 30 to 70 percent, said Anas Iqtait, an expert on Middle Eastern economies at Australian National University. "The only way for the economy to recover, if at all, is through extensive international intervention."

"It was an unacceptable situation before the war," Khalidi said. "We know how much that contributed to the sense of desperation … that Gaza had become accustomed to."

Source: The Washington Post

To stay updated on all economic events of today, please check out our Economic calendar

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Warren Takunda

Traders' Opinions

The Australian Dollar (AUD) experienced upward momentum following robust wage data, with Australia's Wage Price Index rising to 4.0% year-on-year in Q3, surpassing market expectations. The figures indicate potential for further Reserve Bank of Australia interest rate hikes, supporting the AUD. External factors, including positive economic indicators from China and the U.S., played a significant role in the currency's movement. China reported higher-than-expected industrial production and retail sales, signaling a positive outlook for Australia's key trade partner. Additionally, weaker-than-expected U.S. CPI inflation data eased concerns of aggressive interest rate hikes by the Federal Reserve, contributing to the global rally of risk-sensitive assets, including the Aussie Dollar. However, analysts suggest that wage growth in Australia may have peaked, and the market is now anticipating a shift in RBA rate hike expectations, which could impact the AUD's future trajectory.

The Australian Dollar (AUD) demonstrated strength in the wake of encouraging wage data, as the country's Wage Price Index for the third quarter surpassed market expectations, rising to 4.0% year-on-year. This exceeded the anticipated 3.9% figure and outperformed the previous quarter's outcome of 3.6%. On a quarter-on-quarter basis, the 1.3% increase aligned with expectations but represented a notable uptick from the 0.9% rise in Q2. These figures suggest that wages continue to exert upward pressure on domestic inflation, potentially influencing the Reserve Bank of Australia (RBA) to consider further interest rate hikes.

The Australian Dollar's reaction was evident in currency pairs, with the Australian Dollar to U.S. Dollar exchange rate climbing to 0.6509, the Pound to Australian Dollar exchange rate declining to 1.9158, and the Euro to Australian Dollar rate falling to 1.6711.

Australian Dollar Rises on Strong Wage Data, Global Supportive Numbers_1

However, analysts from Commonwealth Bank caution that recent survey data indicates wage growth may have peaked. They anticipate a reversal in market pricing for additional RBA rate hikes, potentially leading to a lower AUD/USD.

External factors played a crucial role in shaping the Australian Dollar's movements. Positive economic indicators from China, a key trade partner for Australia, included a 4.6% year-on-year increase in industrial production in October, surpassing expectations. Retail sales in China also exceeded consensus forecasts, jumping 7.6% in the year to October. These developments signaled an improved outlook for Australia's economic connections.

The primary catalyst for the AUD's gains, however, came from the U.S., particularly following the release of weaker-than-expected U.S. CPI inflation data. The data suggested that the Federal Reserve might be concluding its interest rate hike cycle, boosting global equities and risk-sensitive assets, including the Australian Dollar. Market expectations have adjusted, with an anticipation of interest rate cuts by mid-year, further supporting the global economic backdrop and currencies like the Australian Dollar.

Australian Dollar Rises on Strong Wage Data, Global Supportive Numbers_2

AUDCHF pair presents favorable buying opportunities, with the market positioned above the support level at 0.57692. Buyers are actively pushing the market toward targeted levels, indicating potential strength in the Australian Dollar against the Swiss Franc.

The intricate interplay of domestic wage dynamics, global economic indicators, and central bank expectations creates a complex landscape for the Australian Dollar, requiring market participants to closely monitor evolving factors for a nuanced understanding of its future trajectory.

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Alex

Economic

The US Senate took the risk of an impending partial government shutdown off the table on Wednesday as it passed a stopgap spending bill and sent it to President Joe Biden to sign into law before a weekend deadline.

The 87-11 vote marked the end of this year's third fiscal standoff in Congress that saw lawmakers bring Washington to the brink of defaulting on its more than US$31 trillion (RM146 trillion) in debt this spring and twice within days of a partial shutdown that would have interrupted pay for about four million federal workers.

The last near-miss with shutdown led to the Oct 3 ouster of Republican US House of Representatives Speaker Kevin McCarthy that left the chamber leaderless for three weeks.

But lawmakers have bought themselves just a little more than two months' breathing room. The Democratic-majority Senate and Republican-controlled House of Representatives' next deadline is Jan 19, just days after the Iowa caucuses signal the start of the 2024 presidential campaign season.

"No drama, no delay, no government shutdown," Democratic Senate Majority Leader Chuck Schumer said prior to the vote.

McCarthy's successor, Speaker Mike Johnson, produced a stopgap funding bill that drew broad bipartisan support, a rarity in modern US politics. Democrats said they were happy it stuck to spending levels that had been set in a May agreement with Biden and did not include poison-pill provisions on abortion and other hot-button social issues.

Republicans said they were eager to avoid the risk of a shutdown, which would have closed national parks and disrupted everything from scientific research to financial regulation. But hardline members of Johnson's 221-213 Republican majority voiced anger at the compromise, saying they would try to rein in federal spending again when current funding expires.

"The speaker has now 10 days to work it out and get Republicans to actually stand up and fight when we get back," Representative Chip Roy, a prominent hardliner, said as House lawmakers left Washington for a Thanksgiving holiday break. "We expect that fight when we get back."

The legislation would extend funding for military construction, veterans benefits, transportation, housing, urban development, agriculture, the Food and Drug Administration and energy and water programmes through Jan 19. Funding for all other federal operations — including defence — would expire on Feb 2.

The repeated fights over providing funding to keep the government operating — Congress's most essential function — have prevented lawmakers from acting on other proposals, including Biden's request for US$106 billion in aid for Israel, Ukraine and US border security.

Source: Reuters

To stay updated on all economic events of today, please check out our Economic calendar

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Palestinian-Israeli conflict

Latest news on the Israeli-Palestinian conflict

0:02

Air raid sirens sounded in northeastern Israel, suspected of being attacked by Hezbollah drones.

Latest News on the Israeli-Palestinian Conflict (November 16)_1

0:04

Hezbollah in Lebanon launched attacks on the Israeli border, with missiles hitting the Hadab Yaroun, Birket Risha, Jabal Tayarat and Jal Al-Alam IOF locations.

0:30

The US military is assisting Israel with tens of thousands of 155mm artillery shells, thousands of shoulder-fired anti-bunker missiles and 200 suicide drones.

An internal Pentagon document seen by Bloomberg on Wednesday morning detailed a list of weapons aid proposed by "senior Israeli leaders" as of the end of October:

2,000 laser-guided Hellfire missiles for Apache helicopters and 36,000 rounds of ammunition for the helicopter's 30mm cannon. Apaches have been conducting aid missions near ground forces in the Gaza Strip and along the Lebanese border.

Missiles and ammunition for the artillery have been provided to the Israel Defense Forces. Israel asked Nammo Talley Defense to manufacture 3,000 M141 anti-bunker rockets. These shoulder-fired missiles are capable of penetrating concrete up to 20 centimeters; as of the end of October, 1,800 of them had been shipped.

Israel also requested 400 120mm mortar shells.