RBNZ Left OCR Unchanged Amidst Latest Lockdown. Hawkishness Maintained
To everyone’s surprise, the RBNZ left the OCR unchanged at 0.25% in August. The decision was made in light of the renewed New Zealand’s lockdown after a report of one coronavirus case. Policymakers, however, maintained a hawkish stance, suggesting that the next policy decision would be tightening. Meanwhile, the...
Kiwi Jitters after RBNZ Stands Pat, Euro Weakening
Commodity currencies recover mildly in Asian session but remain the worst performing ones for the week. Markets seemed to have priced in RBNZ standing pat well already. New Zealand Dollar recovered very quickly after initial spike following the announcement. On the other hand, Swiss Franc, Yen and to a...
Risk-Off Sentiment Supports Swiss Franc, Yen and Dollar
Souring risk sentiment continues to support Swiss Franc and Yen today, while Dollar is also trying to catch up. Commodity currencies are still the weakest ones. In particular, New Zealand Dollar tumbles on talks that RBNZ could refrain from delivering the highly anticipated rate hike tomorrow, as the country...
Aussie Stays Weak after RBA Minutes, Same as Other Commodity Currencies
Commodity currencies remained generally pressured in Asian session today. While DOW and S&P 500 managed to reverse initial losses to close at new record highs, there is no follow through risk-on sentiment in Asia. Canadian Dollar is additionally weighed down with WTI crude oil dipping below 68 handle. Aussie...
Swiss Franc and Yen Rise as Markets Turn to Risk-Off Mode
Risk aversion is a main theme today, on situation in Afghanistan, poor China data, and spread of Delta virus. Yen and Swiss Franc rise broadly, and to a lesser extent followed by Dollar. Commodity currencies are all in red, in particular with Aussie pressured by increasing pandemic restrictions. On...
RBNZ Preview – Raising Rate as Least Regrets Option
The market has priced in a 25 bps hike, bringing the OCR to 0.5%, at this week’s RBNZ meeting. Much stronger-than-expected economic recovery since the last meeting, the rapidly rising inflation and inflation expectations, and a better job market are the key reasons for the rate increase. Signs of...
Yen Rises on Weak China Data, Strong Delta Spread
Yen rises broadly in Asian session on a couple of risk off factor, all linked to the pandemic. The set of weaker than expected data from China suggested that recovery is losing much momentum as the coronavirus is back. Japan reported surge in infections while Australia is also back...
CFTC Commitments of Traders – Traders Bet Aussie to Go Lower as Resurgence of Pandemic Triggers Lockdown Extension
As suggested in the CFTC Commitments of Traders report in the week ended August 10, NET SHORT of USD index futures added +445 contracts to 19 326. Speculative long positions rose +2 514 contracts while shorts increased +2 069 contracts. Concerning European currencies, NET LENGTH in EUR futures fell...
CFTC Commitments of Traders – Bets on Higher Crude Oil Price Shrank as Widespread Coronavirus could Again Hurt Chinese Demand
According to the CFTC Commitments of Traders report for the week ended August 10. NET LENGTH for crude oil futures slumped -30 114 contracts to 400 413 for the week. Speculative long position sank -27 408 contracts, while shorts increased +2 706 contracts. As we had anticipated, the sharp...
Slowing Core Inflation, Deteriorating Consumer Sentiment, and Split Fed
It's all about the consumers. After slowing core inflation and sharp deterioration in sentiment, Dollar took a steep dive towards the end of the week. Markets are suddenly less sure about a tapering announcement by Fed in September, not to mention anything concrete from Jackson Hole symposium later in...
EUR/USD Rebounds ahead of Weekend, Confirming Short Term Bottoming?
Euro and Swiss Franc rise broadly as the markets are approaching the weekly close. On the other hand, Canadian Dollar is reversing some of this week's gains, while Dollar is following as second weakest for the day. As for the week, the Loonie is still the strongest, followed by...
Sterling Turning Weaker in Crosses, Dollar Lacks Clear Direction
Trading in the Asian markets is relatively subdued again. Asian stocks are mixed even though DOW and S&P 500 rose to new record highs overnight. Dollar continues to fail to find a committed direction. While the greenback remains firm against Euro, Swiss Franc and Yen, it clearly lacks upside...
Dollar Regains Some Ground after PPI and Jobless Claims, Staying in Range
Dollar is trying to regain some ground in early US session after stronger than expected PPI. Both initial and continuing jobless claims also continued to trend lower. The greenback is followed by Euro and Yen while Aussie and Kiwi are softest. Though, major pairs and crosses are staying inside...
Crude Oil Price Recovered as US Inventory Resumed Decline. Outlook Remains Masked by Delta
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks slipped -0.14 mmb to 1267.52 mmb in the week ended August 6. Crude oil inventory resumed decline, falling-0.45 mmb (consensus: -1.27 mmb) to 438.78 mmb. Stockpile decreased in PADD...
Dollar Retreats as EUR/USD Tests 1.7 Support
The forex markets are generally trading in very tight range in Asian session. While DOW surged to new record high overnight, Asian indexes are just mixed. Dollar started a pull back but there is no clear follow through selling so far. At the same time, commodity currencies are generally...
Dollar Paring Gains after CPI Release, Commodity Currencies Jump with Stock Futures
Dollar drops notably in early US session after consumer inflation data. Headline CPI was steady while core CPI slowed a little. At least, inflation hasn't been worsening from Fed's "transitory rhetoric". US stock futures also jump, probably on reduced concerns over monetary tightening. New Zealand and Australian Dollars are...
Dollar Rally in Force as Focus Turns to CPI
Dollar's rally continues in Asian session today, in particular against Euro, Swiss Franc and Yen. Though, cautious comments from Fed Evans is not giving any particular boost elsewhere. Commodity currencies are still resilient, as supported by overall optimistic sentiment, with DOW closing at new record high. Main focus will...
Volatile Gold Price will Remain be Driven by Speculations of Fed’s Tapering
Gold trading is slim after Monday’s sharp selloff. Despite concerns over the delta variant, the precious metals lost their safe haven appeal as speculations over Fed’s early tapering escalated after the strong nonfarm payolls data. The front-month Comex gold contract slumped to a 4-month low of 1677.9 before settling...
Euro Falls after Sharp Fall in Economic Sentiment, Accelerating Lower
Euro falls broadly today after data showed surprised sharp fall in Germany and Eurozone economic sentiment. But at this point, Swiss Franc is even worse, while Yen is not far behind. On the other hand, Sterling and commodity currencies are trading generally higher, which much help from crosses. Dollar...
Dollar Extended Rally Tapering Talks, Staying Firm
Dollar's rally continued last week as supported by hawkish comments from Fed officials. Expectations for tapering this fall continued to build up. Swiss Franc is trading broadly lower, as the pull back against Euro accelerated. Meanwhile, Australian is also trading lower on poor business confidence data. Focus will turn...