Mon, Nov 30, 2020 @ 11:22 GMT
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Yen, Dollar and Swiss Franc Suffer as Markets in Full Risk-On Mode

Yen traders broadly lower today as risk appetite extends from Asia markets to Europe and then US. Dollar is following as the second weakest and then Swiss Franc. Meanwhile, New Zealand, Australian and Canadian Dollars are the strongest one. The development is pretty normal on a "risk-on" day. Sterling...

Sterling Surges on Irish Backstop Time Limit Rumor, Pressing Key Resistance Against Dollar and Euro

Sterling surges broadly today on rumors that Northern Ireland's DUP has privately agreed to conditional support to Prime Minister Theresa May's Brexit deal. The Pound is also the strongest one for the week. While there are still a lot of uncertainties surrounding Brexit outcome, at least, the threat of...

US Oil Inventory Increased Across the Board as Fear on Global Slowdown Intensified

The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks gained +6.7 mmb to 1267.11 mmb in the week ended January 18. Crude oil inventory soared +7.97 mmb to 445.03 mmb (consensus: -0.04 mmb). Inventories increased in ALL 5...

ECB Turns Dovish amid Heightened Global Uncertainties

The ECB meeting evolved as we had expected: more dovish, downgraded assessment on economy, leaving unchanged the forward guidance on interest rates. the central bank has acknowledged that the uncertainties in the global economy have intensified and can persist for quite an extended time. No change was made in...

Euro Survives Downbeat ECB and Weak PMIs, Safe for Now

Euro has been under broad based pressure today after PMIs suggest more weakness in the economy ahead. The common currency then spikes further lower ECB President Mario Draghi sounds rather cautious and downbeat in the post meeting press conference. However, Euro quickly recovers as Draghi actually didn't bring out...

Euro’s Recovery Might be Cut Short by Weak PMIs and Cautious ECB

European majors are trading generally higher today as Eurozone will take the center of stage. There are worries of deeper and longer than expected slowdown in the Eurozone economy. PMIs from Germany, France and Eurozone will provide some hints on economic performance at the start of the year. ECB...

BOJ Cut CPI Forecasts, But Is it Realistic to Expect Tax Hike will Help Inflation?

As widely anticipated, BOJ voted 7-2 to leave left the policy rate unchanged at -0.1% in January. All other policies also remained intact: purchases of JGBs at a pace of 80 trillion yen/ year and maintenance of 10-year JGB yield at 0%, with trading band at +0.2% and –...

Sterling Shines as Campaign to Block No-Deal Brexit Gains Momentum

Sterling is the star performer today as campaign to block no-deal Brexit in the UK gathers momentum. Some upside acceleration is seen after the Pound takes out near term resistance against Dollar, Euro and Yen. New Zealand Dollar is following as the second strongest as boosted by stronger than...

Yen Lower after BoJ Downgrades Inflation Forecasts, Sterling Pressing Near Term Resistance

Risk sentiments stabilized in Asia today despite the selloff in US overnight. But so far, momentum for rebound in stocks is very weak. Major indices are stuck in right range between gains and losses, in particular in China and Hong Kong. Yen is trading as the weakest one for...

Yen Strengthens With Markets in Mild Risk Aversion, Australian Dollar Tumbles

Mild risk aversion is the main theme in the financial markets today. Selloff started in Asia, in particular in China, and spread to European session. Japan 10-year JGB yield also turned negative again. In the currency markets, Australian Dollar leads other commodity currencies lower in a typical day of...

Sterling Soft on Brexit Stalemate, Yen and Dollar Higher

Sterling is trading lower in Asian session today as UK Prime Minister Theresa May's uninspiring statement did nothing to break the stalemate. But, commodity currencies are equally weak, if not weaker, following decline in the stock markets. There is no clear theme but investors appear to be turning cautious...

Dollar Attempting to Rise in Mixed Holiday Markets, Near Term Resistance Still Holds

The forex markets are rather mixed and quiet today. Trading has also become a bit subdued as US is on Martin Luther King day holiday. But UK Prime Minister Theresa May's Brexit plan B might still trigger some volatility. For now, New Zealand Dollar remains the weakest one for...

Chinese Economy Shows Signs of Stabilization in Late 2018. More Challenge Ahead

The latest set of macroeconomic data for China shows signs of stabilization. This could be attributed to the government's expansionary policies both monetarily and fiscally. While the government is expected to add more stimuli this year, the challenge remains tough. GDP growth eased to +6.4% y/y in 4Q18, from +6.5%...

Chinese Data Show Stabilization Sign, UK May’s Brexit Plan B Awaited

The financial markets are rather quiet today. Asian stocks trade higher despite data showing China's growth in 2018 slowed to lowest since 1990. But December data painted a picture of stabilization. Also, there is optimism on US-China trade talks, despite a lack of detail on the progress. Meanwhile, Yen,...

ECB Preview – ECB to Turn More Dovish as Economic Data Surprise to Downside

We expect ECB to turn more dovish at the meeting later this week, as economic data have pointed to further weakness. There are several issues worth watching for the meeting: rhetoric on economic outlook, instruments to alleviate tightening of credit conditions after the end of QE, and forward guidance...

Trade Optimism Lifted Stocks, Yields and Dollar

Brexit and US-China trade negotiation were the two major themes last week. After a week of drama, it's still unclear exactly what kind of Brexit deal would get through the Parliament. There's some anticipation for UK Prime Minister Theresa May on her plan B on Monday. Yet she could...

Canadian Dollar Jumps on CPI and Oil, Sterling Pares Gain after Weak Retail Sales

Canadian Dollar strengthens mildly in early US session and is trading as the strongest one for today so far. Recovery in oil price has been supporting the Loonie through the day. And, further lift is given by stronger than expected CPI reading. Euro is following as the second strongest,...

Sterling Extends Rally, Yen Lower on Risk Appetite, Dollar Follows Yields Higher

Yen trades generally lower in rather quiet markets today. Risk appetite strengthens mildly despite extended record run in US government shutdown. There were rumors that US is considering to roll back tariffs to facilitate trade negotiation with China. But that was quickly denied. Nevertheless, Fed's "patience" rhetorics continued which...

Sterling Enjoying Renewed Buying, But Traders Remain Cautious

Renewed buying emerges in early US session for Sterling and it's trading as the strongest for today so far. But for now, the Pound's strength is relatively limited against Yen and Dollar. Investors would need to know more about the Brexit plan B before committing. Yen is supported by...

PBOC’s Aggressive Liquidity Injection Reveals Severe Growth Slowdown

PBOC has aggressively increased market liquidity. In the form of reverse repo operations, the central bank announced Wednesday that a total of RMB 570B would be pumped to the market. With RMB 10B of previous reverse repo maturing, the net injection would be RMB 560B. While the central bank...