Greg Gibbs, Analyst at Amplifying Global FX Capital, points out that the September FOMC member median projections included a fourth hike this year in December, three further hikes in 2019 and one more in 2020. Key Quotes “The Fed fund futures market has largely priced in a hike in December. It is no longer quite
The latest headlines from ECB Watch cites that the Eurozone money markets are no longer fully pricing in a 10 basis point rate hike from the ECB next year. Meanwhile, the money market futures dated to ECB’s Dec 2019 meeting now price only a 95% chance of rate hike form 100 % on Monday.
Spanish PM Sanchez is on the wires now, via Reuters, expressing his take on the Brexit deal. Key Points: Spain to vote against Brexit deal if text on Gibraltar not amended. As things stand Spain will vote against Brexit deal. He will call elections when in Spain’s benefit. Budget could mean early election.
Reuters reports comments by the N. Irish DUP MP Sammy Wilson, with the key headlines found below. Not for the DUP to determine who is leader of the Conservative party, would be wrong for dup to interfere. Want to continue to work with the government to see if the deal can be changed. Last night
• A fresh wave of a global risk-aversion trade underpins traditional safe-haven assets. • The prevalent USD selling bias provides an additional boost and remains supportive. Gold reversed an early dip to $1221 area and turned higher to hit near two-week tops during the early European session. A combination of supporting forces helped the
According to analysts at ANZ, despite challenges, the New Zealand economy has shown considerable resilience. Key Quotes “The unemployment rate unexpectedly fell to 3.9% in the September quarter and resources in the economy are stretched.” “A number of factors are expected to continue to support growth, but headwinds remain and GDP is expected to grow
Italy’s deputy Prime Minister Luigi Di Maio was out on the wires in the last hour, saying that solution on the budget can be found if the dialogue is open. Key quotes: • Talks should not result in a battle between Italy and Brussels. • Want to do so without getting rid of the
The pair resumes the upside and tests session peaks near 1.1460. The greenback remains depressed and sidelined in the 96.20 area. Brexit and Italy remain the main drivers of the pair near term. The upbeat tone around the European currency remains well and sound so far today and is now lifting EUR/USD to the area
In the US, the NAHB housing market index dropped to 60 in October from 68 in September, notes the research team at Danske Bank. Key Quotes “The level remains high but the trend is not good. Many housing indicators are turning around and while the interpretation is difficult given the extremely high volatility in most
In the UK, Brexit concerns remain front and centre, as we await word whether Tory rebels can muster the 48 letters necessary to trigger a leadership challenge, points out the research team at TD Securities. Key Quotes “Today’s Parliamentary testimony by several BoE officials – including Governor Carney – will be notable though cable remains
TALKING POINTS – POUND, BREXIT, CARNEY, BANK OF ENGLAND British Pound eyes Carney testimony amid “no deal” Brexit worries Australian Dollar down as AsiaPac stocks follow Wall Street lower NZ Dollar holds up as yields and demand tick higher at bill auction Testimony from Bank of England Governor Mark Carney before a Parliament’s Treasury committee
According to analysts at Danske Bank, the two main things to look out for in the near-term for the UK economy are whether there will be a no confidence vote in Theresa May and whether the supporting party, Ulster’s DUP, will pull its support for the government. Key Quotes “With respect to the former, it
In line with the unanimous consensus, analysts at TD Securities expect the NBH to keep all its policy rates on hold today. Key Quotes “We also expect little change in the press statement, which will downplay the rise in headline inflation to 3.8% Y/Y in October and maintain that the 3% target should be reached
The last twenty-four hours in the EUR/USD sees intraday action near the 1.1450 level heading into Tuesday’s major market sessions, after catching a confusing lift on Monday from a floor near 1.1390. Intraday support is sitting at the 38.2% Fibo retracement level near 1.1435, and it could be a pivotal intraday zone. EUR/USD Analysis: Rallies
Moody’s Investors Service said in a report on Tuesday, The Reserve Bank of India’s decision to allow lenders more time to comply with the additional capital buffer norms under Basel 3 is credit negative for the country’s state-run banks. Key Quotes (via Reuters): “The decision to extend the timeline for the full implementation of Basel
Analysts at TD Securities note that after a marathon 9 hour board meeting yesterday the RBI and Indian government appeared to come to an agreement on the use of RBI reserves and a review of its assessment of state banks NPLs. Key Quotes “The RBI will set up of a committee to examine reserves management.
Analysts at Danske Bank suggest that in the UK, focus remains on Brexit and any news regarding Theresa May’s uncertain future as PM and party leader. Key Quotes “May is expected to travel to Brussels today to discuss trade. Apart from politics, markets will also keep an eye on any changes in the BoE’s rhetoric,
As noted by Bloomberg, the head of Columbia’s Threadneedle, Ed Al-Hussainy sees no way to successfully trade UK Prime Minister Theresa May’s current slow-motion Brexit crisis, and the only feasible solution is to adjust perspective on the UK and instead focus on the Bank of England (BoE), and its interest rate struggles. Key quotes From
The last twenty-four hours saw US crude dip into the 55.00 critical level before immediately rebounding to familiar resistance levels near 57.00. WTI Chart, 5-Minute Despite some shocks to the downside, American crude barrels are holding steadily above the near-term bottom at 54.75 as energies traders recover from several months of headline-fueled shock selling. WTI
Forex today in Asia witnessed risk-off market profile for the second day in a row this Monday, as the Asian stocks tracked the heavy losses in their Wall Street counterparts. Amid risk-aversion, the Aussie was the biggest loser while the Yen recovered ground and dragged the USD/JPY pair back to the 112.50 level. The Aussie
The Bloomberg US financial condition index shows significantly tighter conditions since the September FOMC, although only back to levels in April this year, points out Greg Gibbs, Analyst at Amplifying Global FX Capital. Key Quotes “Money-market spreads are narrower since earlier in the year, although they too have risen in recent months. This suggests that
The US Dollar added to Friday’s broad-based weakness, triggered by dovish comments by the Fed Vice Chairman Richard Clarida, and lost some additional ground on the first day of a new trading week. The greenback nosedived on Friday after Clarida, in an interview on CNBC, said that interest rates are nearing a neutral rate and
Brexit tensions remain high, but volatility has tightened up as investors await the next turn of the page. The UK’s latest Inflation Hearings sees the BoE’s Carney on the testimony stand today in parliament. GBP/USD is trading flatly near 1.2850, keeping tied to familiar levels for the week as Sterling traders enjoy a breather from
GOLD & CRUDE OIL TALKING POINTS: Gold prices rise as yields drop amid broad-based risk aversion Crude oil prices whipsaw higher on comments from IEA’s Birol S&P 500 futures hint at risk-off mood ahead, API data on tap Gold prices rose as bond yields declined amid risk aversion, boosting the relative appeal of non-interest-bearing alternatives.
Richard Franulovich, Head of FX Strategy at Westpac, notes that the National Association of Homebuilders (NAHB) sentiment index of US posted an eye-catching fall to 60 in November from 68, its lowest levels since mid-2016. Key Quotes “The US housing sector has been losing momentum for a few months in the wake of higher rates
The EUR/USD closed above the key 38.2 percent Fib retracement yesterday, validating the falling wedge breakout witnessed on Nov. 16. The EUR is showing resilience to risk aversion and renewed US-China trade tensions, possibly due to favorable developments in the bond markets. The EUR/USD is looking north amid risk aversion in the financial markets. The
The International Monetary Fund’s (IMF) Article IV mission warns that risks to Australia’s economy are skewed to the downside and so the Reserve Bank of Australia (RBA) should keep rates low. Key points Economic expansion expected to continue Gradual upward pressure on wages and prices likely Notes and Welcomes slowing housing market Warns of risks
The People’s Bank of China’s Research Head Xu Zhong is on the wires now, via Reuters, expressing his thoughts on the bank and the economy. Key Comments: The previous policy change has weighed on China’s economy. Cannot mix up short-term macro policies with reform goals. Downward pressure on China’s economy has significantly increased. Downward pressure
Analysts at Commerzbank offer their view on the Euro in the coming months, in the wake of the Italian political risks. Key Quotes: “There is a lot to suggest that the EUR weakness is coming to an end unless Rome produces new disturbing signals. The bond market still sees an increased risk in the Italian