Sterling Range-Bound as BoE Projections Eyed, Yen Rebounds
Yen jumps broadly today as risk appetite continues to recede in Asian session. Investors turned a bit cautious as it's still uncertain when and where US and China would sign the phase one trade agreement. Currently, Swiss Franc is the second strongest, followed by Dollar. On the other hand,...
US Crude Oil Inventory Extended Gains
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks dropped -1.59 mmb to 1286.81 mmb in the week ended November 1. Crude oil inventory jumped +7.93 mmb to 446.78 mmb (consensus: +1.52 mmb). Inventory gained in 4 out...
Dollar Pares Gain ahead of Resistance in Indecisive Markets
The markets are relatively indecisive today. It seems that rally in stock markets have passed a near term climax, awaiting fresh developments in US-China trade negotations. Treasury yields also turn mildly lower after yesterday's rally. In the forex markets, Dollar struggles to ge through near term resistance against both...
Risk Appetite Takes a Breather, NZD Down on Unemployment Rate
Yen strengthens broadly today as markets stabilized from recent strong risk appetite. US stocks closed mixed after extending recent record runs. Euro, Dollar and Sterling follow as the next strongest while markets continue to eye trade developments. Commodity currencies are generally lower. In particular, New Zealand Dollar is weighed...
Trade Optimism Lifts Market Sentiments, Treasury Yields Higher
Trade optimism is the main diver in the financial markets today. There are talks that US officials are considering to remove the 15% tariffs on USD 112B worth of Chinese goods, put to effect back on September 1. In return, US would demand stronger intellectual property protections. If realized...
PBOC Cut 1-Year Lending Rate for the First Time since 2016
For the first time in over 3 years, People’s Bank of China (PBOC) lowers the rate of the 1-year medium lending facility (MLF) by -5 bps to 3.25%. This surprising move underlines the rapid deterioration of domestic growth and paves the way for a cut in the loan prime...
RBA Left Cash Rate Unchanged at 0.75%, Maintained Dovish Bias as Members Struggle to Bring Jobless Rate Lower
As expected, RBA left the cash rate unchanged at 0.75%. Dovish bias remains as policymakers struggled to bring down the unemployment rate and boost inflation. Economic developments showed “little changed“. The members affirmed that “a gentle turning point appears to have been reached“. A quarterly Statement on Monetary Policy...
Aussie Firmer after RBA, Risk Appetite Continues as US Stocks Hit Records
Risk appetite continues in Asian session, following record closes in US. Yen and Swiss Franc continue to be broadly pressured. Meanwhile, Australian dollar survived the balanced RBA rate statement and leads other commodity currencies higher. Dollar, Euro and Sterling are mixed, with Dollar having a slight upper hand for...
BOE Preview – Maintaining Dovish Stance although No-Deal Brexit Less Likely
The chance of no-deal Brexit appears to have diminished after Article 50 is further extended to January 2020 and the parliament will hold snap elections in December. However, domestic growth has shown signs of moderating and unemployment rate is bottoming. We expect BOE to maintain the slightly dovish tone...
Risk Appetite Continues as Yen Stays Weak, Dollar Defending Support
Yen and Swiss Franc remain the weakest ones for today, following strong rally in global stocks. US indices would likely extend the record run, as futures suggest. German and US benchmark yields also climb a bit higher. back in the forex markets, though, Dollar recover mildly as there is...
Risk Appetite Returns on Trade Optimism, Yen and Swiss Franc Softer
Strong risk appetite dominates Asian session today, partly as follow through buying from US, and partly on trade optimism. Commodity currencies are trading generally higher, as led by New Zealand Dollar rand then Australian. On the other hand, Swiss Franc and Yen are the weakest ones for now. Dollar...
CFTC Commitments of Traders – Significant Decline in GBP Net Short Suggests Market Hopeful of Election Outcome
As suggested in the CFTC Commitments of Traders report in the week ended October 29 NET LENGTH in USD Index slid -1 701 contracts to 39 509. Speculative long positions fell -3 650 contracts and short positions dropped -1 949 contracts. Concerning European currencies, NET SHORT for EUR futures...
CFTC Commitments of Traders – Bets for Higher Commodity Prices Increased Across the Board
According to the CFTC Commitments of Traders report for the week ended October 29, NET LENGTH for crude oil futures soared +17 175 contracts to 388 347 for the week. Speculative long positions added +3 291 contracts while shorts slumped -13 884 contracts. For refined oil products, NET LENGTH...
Fed, BoC and RBA Expectations Drove USD, CAD and AUD
With US-China on track to phase one trade deal, and UK preparing for December election, focus turned back to economic data and central banks last week. In particular, Canadian Dollar ended as the worst performing after BoC's surprise dovish turn, which opened the door for rate cut. Dollar followed...
Dollar Rebounds on NFP, But Upside Capped by Unemployment Rate and Wage Growth
Dollar rebounds notably in early US session after stronger than expected non-farm payrolls report. But there is no clear follow through buying yet as wage growth missed. Also, at this point, New Zealand Dollar and Sterling are the strongest ones for today. Return of risk appetite sends Yen and...
Dollar Soft as Markets Await US Non-Farm Payrolls, Aussie Firmer on Chinese Data
Dollar stays soft in Asian session today as markets await non-farm payrolls and ISM manufacturing data. Yen and Swiss Franc follow as next weakest. On the other hand Aussie and Kiwi are the strongest ones so far, both are lifted mildly by slightly better than expected Chinese data. For...
Yen Jumps on Renewed US-China Trade Concerns, Dollar Extends Post FOMC Selloff
Yen rises notably today as focuses turn back to US-China trade negotiations after central bank activities and economic data releases. There are renewed concerns that even if a phase one deal could be reached, the next phase(s) would be very difficult. Dollar remains generally soft and is currently trading...
Dollar Dives as Non-Committal Powell Dissatisfied Bulls, Aussie Shines
Both Dollar and Canadian are under tremendous selling pressure after respective central bank announcements overnight. Fed chair Jerome Powell did signal a pause after yesterday's rate cut. Yet, his message was too non-committal and let Dollar bulls dissatisfied. On the other hand, BoC was clearly more dovish than expected...
Turning Dovish, BOC Discussed about Insurance Rate Cut for First Time In October
BOC turned dovish in the October meeting, while maintaining the policy rate unchanged at 1.75%. For the first time, the central bank discussed about “insurance” rate cut, citing trade war’s damage to business investment and exports. The announcement sent the loonie lower, giving half of the gains made earlier...
Fed Signals to Pause after a Third Rate Cut
FOMC delivered a hawkish cut at the October meeting. The central bank lowered the Fed funds rate, by -25 bps, to 1.5-1.75%. Yet, the Fed removed the language that it will act to sustain expansion at the forward guidance. This appears that the Fed has prepared to pause after...