The Latest in Forex News & Analysis.

GBP surges on Brexit Talk

By | October 12, 2017 2:19 pm | 0 Comments

GBP/USD surged after a German paper reported that Michael Barnier, Chief EU Negotiator, might offer UK a 2 year transition period in the EU, if UK meets its exit obligations.

GBP/USD trading at 1.3280 after touching a daily low of 1.3120

FED Minutes

By | October 11, 2017 5:41 pm | 0 Comments

FED minutes released today show that this December rate hike was a close call. Some FED voting members believe that inflation might stabilize below 2% without showing great confidence for the future. The market reacted with USD selling on multiple asst classes.

EUR CPI

By | September 29, 2017 9:15 am | 0 Comments

EUR Core CPI YoY 1.1% vs 1.2% forecast and 1.2% prior reading. CPI YoY 1.5% vs 1.6% expected.

First decline for Core CPI in this quarter as we approach the deadline for ECB October meeting when President Draghi will communicate the monetary policy path and QE decision for 2018.

Considering that ECB has single mandate (price stability), we are currently far from the 2% target. Main concern is still that a single solution has to satisfy a multi-speed region like EU (Italian CPI MoM -0.3% vs -0.1% expected) .

End of Day Recap

By | September 27, 2017 4:55 pm | 0 Comments

US Core Durable Goods MoM 0.2% vs 0.2% forecast. US Durable Goods Mom 1.7% vs 1%. A positive reading for the US with a USD that strengthened on the day (USD Index + 0.43%).

Risk on across may asset classes, with equities up (new all time high for S&P500)  and metals down (XAU breaking a key support and now trading at 1283).

BoC Poloz with a dovish tone in his press conference sent USD/CAD to 1.2482, up 0.91%. A cloud of uncertainty over the next Central Bank move, considering also a weaker USD (compared with the beginning of the year) that might not help exports.

RBNZ rate announcement. Interest Rates unchanged with dovish comments. Lower NZD might be needed to support recovery and inflation growth.

Draghi Press Conference

By | September 25, 2017 10:50 am | 0 Comments

A cautious Mario Draghi reiterated on Monday that downside risks in EU are mostly tied to geopolitical factors. Growth is still in place but ECB should pay attention to not halt recovery.

Final decision on QE will be taken in October, as previously anticipated.

CAD CPI

By | September 22, 2017 10:57 am | 0 Comments

CAD Core CPI for August came out at 0% compared with previous reading of -0.1%. Core CPI YoY stays stable at 0.9%. CPI YoY at 1.4% vs 1.5% forecast.

Disappointment on Core Retail Sales MoM, 0.2% vs 0.4% forecast with previous number revised down to 0.4% from 0.7%. Retail Sales MoM 0.4% vs 0.1% forecast.

Next Interest Rate decision for Bank of Canada is on October 25th, with current market expectation split almost 50/50.

BoC already raised Interest Rates twice this year surprising the market so far. Volatility on USD/CAD is expected to raise as we get closer to the IR decision.

 

UK Retail Sales

By | September 20, 2017 9:14 am | 0 Comments

Uk Retail Sales YoY at 2.8% vs 1.4% forecast. Also, prior reading revised up to 1.7% from 1.5%.

The number for the month of August is even more impressive: 1% vs 0.2% forecast.

This reading (2.8%) makes clear that consumption in the UK is coming back. It is bouncing from a year low of 0.6%, but it is still far from last year 6.2% recorded always in September.

Next week, UK GDP (Q2) should make things more clear, considering that now the market is pricing a rate hike during November MPC meeting at 64.6%.

RBA minutes

By | September 18, 2017 9:56 pm | 0 Comments

Minutes from September 5 RBA monetary policy meeting;

  • -Solid employment growth, domestic data positive
  • -AUD$ rise in large part reflect USD decline
  • -Need to balance risks of high household debt and low CPI
  • -Recent domestic data consistent with gradual pickup in growth
  • -Further rise in AUD$ would weigh on growth and inflation

 

Overall positive tone on its economic assessment but not satisfied with slow inflation and didn’t forget to add usual comment against further currency appreciation.

AUD$ trading rather choppy went 90 paid then 70 given after the release.

Australia Q2 house price index was out at the same time +1.9% vs 1.1% forecast.

Yen jumps on N Korea missile launch

By | September 14, 2017 6:45 pm | 0 Comments

$JPY drooped to 109.55 low in a blink on the back of a headline North Korea launched another missile flew over Japan landed 2000 kms to the east of Hokkaido. Japanese officials warned residents to take shelter.

US Stock futures traded lower in tandem with $JPY but so far little reaction in Gold and Swiss Franc.

Details of missile are yet to be known but earlier today North Korea made a threatening to sink Japan and reduce the U.S. to ashes and darkness.

US CPI and Jobless claims

By | 12:51 pm | 0 Comments

US Core CPI YoY came out higher than expected at 1.7% vs 1.6% forecast. Core CPI MoM August 0.2%.

Initial Jobless Claims at 284k vs 300k forecast. Bad news for real earnings at -0.6% vs -0.2% forecast.

It might seems a step in the right direction towards the 2% inflation target that the FED tries to achieve. The discussion for another rate hike by year end remains open for debate.

 

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