Markets Staying Heavy on Omicron Worries
Worries about Omicron remains a main theme in the markets. Nikkei takes a dive after Japan announced to close its borders to all foreigners as Prime Minister Fumio Kishida said he's taking measures with a "strong sense of crisis". The forex markets are relatively quiet for now, with Yen...
Investor Confidence Shattered by Omicron Variant, Yen and Swiss Franc Surged
Investor confidence was shattered by the news of the heavily mutated B.1.1.529 coronavirus variant, now called omicron. WHO warned that this variant has a large number of mutations, some of which are concerning. It added that preliminary evidence suggested an increased risk of reinfection with this variant. It may...
Yen and Swiss Franc in Strong Momentum as Risk Aversion Dominates
The new coronavirus variant is the main them in the markets today, sending global stocks and benchmark treasury yields sharply lower. Yen and Swiss Franc are trading sharply higher, followed by Euro. Commodity currencies tumble sharply on risk aversion but Sterling and Dollar are also pressured. For the week,...
New Coronavirus Variant Sinks Investor Sentiment, Yen Marches Higher
Risk-aversion dominates Asian markets today as new coronavirus variant sinks investor sentiment. Australian Dollar is leading other commodity currencies lower. Yen and Swiss Franc surge sharply, followed by Euro and Dollar. Overall, it's flight to safety. The question now is, whether Aussie or Kiwi would eventually end as the...
Dollar Firm in Quiet Holiday Trading, Yen Soft
The forex markets are rather quiet in Asian session today. Trading will probably remain subdued with US on holiday. The greenback remains the strongest one for the week on speculation that the "transitory" yet persistent strong inflation would eventually force Fed to raise interest rate earlier. Canadian Dollar is...
US Crude Inventory Surprisingly Increased
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks slumped -5.98 mmb to 1217.89 mmb in the week ended November 19. Crude oil inventory added +1.02 mmb to 434 mmb, compared with consensus of a -0.48 mmb increase....
Dollar Rally Continues as Jobless Claims Dropped to Lowest Since 1969
Dollar's rally continues today and stays firm after much better than expected jobless claims data. Yen is following as second strongest on risk-off sentiment, as major European indexes and US futures are in red. On the other hand, New Zealand Dollar remains the worst performing one on post-RBNZ selloff,...
RBNZ Hiked Rate but More Cautious about Economic Outlook
The RBNZ raised the OCR by +25 bps to 0.75%, as we had anticipated. Policymakers sounded more cautiously about the economic outlook while reiterating the stance of continued reduction of stimulus. Kiwi extended recent correction after the announcement.
On the monetary policy outlook, the central bank reiterated that “it remains...
NZD Softens after RBNZ Hike, Dollar Firming Up
New Zealand Dollar weakens in Asian session after RBNZ rate hike, and leads other commodity currencies lower. Dollar firms up mildly as it's ready to extend recent rally, except versus Yen for now. European majors are mixed, with Sterling have a mild upper hand against Euro and Swiss Franc....
Sterling Breaking to the Downside, Euro in Weak Recovery
Markets are trading in mild risk off sentiment, while treasury yields also surge. New Zealand Dollar is leading other commodity currencies lower, and Sterling is week too. On the other hand, Euro and Swiss Franc are currently the stronger ones, followed by Dollar and Yen. But overall, it should...
Market Priced in Faster Rate Hike after Powell’s Nomination for Second Term
Hawks were thrilled with Biden’s nomination of Jerome Powell for the second term, thinking that his chairmanship would lead to more rate hikes in the coming year, than that of Lael Brainard, initially viewed as the leading candidate of the Fed Chair in the next term. She is now...
USD/JPY Upside Breakout after Powell Got Nominated Again, Gold Tumbled
Dollar surged overnight after Fed Chair Jerome Powell was nominated for a second term by US President Joe Biden. The greenback stays firm in Asian session and is ready to extend its near term rally. On the other hand, New Zealand Dollar is trading notably lower, as traders are...
Euro Soft But No Fresh Selloff Yet
Euro stays generally soft today even though there is no follow through selling yet. It's reported that Germany's acting Chancellor Angela Merkel urged in a CDU meeting tougher restrictions to combat the fourth wave of coronavirus infection. But the news was shrugged off as the markets have probably priced...
RBNZ To Lift Policy Rate Again after Strong Inflation
The RBNZ is ready to increase the policy rate again this week. The question is whether, in light of the latest strong inflation data, whether the hike is +25 bps or +50 bps. We continue to expect the former. Several banks have lifted the mortgage rates, while bond yields...
Market Consolidates in Tight Range But Euro Looks Vulnerable
The forex markets are generally staying in tight range in Asian session, digesting last week's moves. Euro remains generally soft and looks vulnerable to extend the near term decline, in particular against commodity currencies and Yen. Sterling is so far resilient, awaiting more BoE officials to speak up their...
Euro Dived on Dovish ECB and Lockdown Fears, More Downside Risks ahead
Euro tumbled broadly and deeply last week, and ended as the run away worst performer. It's firstly weighed down by dovish comments from ECB officials, who talked down the need for policy action to counter inflation. More importantly worries grew after Austria returned to full lockdown.
Daily new COVID-19 infections...
CFTC Commitments of Traders – European Currencies Slumped as Austria Lockdown Raises Concern about Outlook
As suggested in the CFTC Commitments of Traders report in the week ended November 16, NET LENGTH of USD index futures dropped -540 contracts to 34 908. Bets on both sides climbed slightly higher. Concerning European currencies, NET SHORT of EUR futures gained +7 599 contracts to 3 826...
CFTC Commitments of Traders -Bets on Crude Oil Price Declined Sharply on Both Sides
According to the CFTC Commitments of Traders report for the week ended November 16, NET LENGTH of crude oil futures dropped -5 527 contracts to 415 785. Speculative longs slumped -42 410 contracts while shorts fell -36 883 contracts. Bets were trimmed on both sides as price correction form...
Euro Hammered as Lockdown Returns, Risk Sentiments Turn Sour
Euro's recovery was rather short-lived as selling returns after dovish comments from ECB president. Also, Austria returned to full lockdown while Germany may follow on the fourth wave of COVID-19 infections. Yen rises broadly today as risk sentiments turn sour. For the week, Euro remains the worst performer, followed...
Euro Recovers, Dollar Retreats as Markets Turn Quiet
Dollar's retreat continues in Asian session, but it remains one of the strongest for the week, just next to Sterling. On the other hand, while Euro is recovering, it's still the worst performing one followed by Aussie. Overall, the markets are staying in a near term consolidative phase with...