Global Markets:
- Asian stock markets: Nikkei up 0.95 %, Shanghai Composite lost 0.10 %, Hang Seng fell 0.55 %, ASX 200 gained 0.15 %
- Commodities: Gold at $1203 (-0.75 %), Silver at $17.03 (-1.40 %), WTI Oil at $51.50 (+0.82 %), Brent Oil at $54.40 (+0.85 %)
- Rates: US 10-year yield at 2.42, UK 10-year yield at 1.34, German 10-year yield at 0.36
News & Data:
- Australia Employment Change Dec: 13.5K (est 10.0K, prev. 39.1K)
- Australia Unemployment Rate Dec: 5.8% (est 5.70%, prev. 5.70%)
- Australia Consumer Inflation Expectations Jan: 4.3% (prev. 3.40%)
- Australia Full-Time Employment Change Dec: 9.3k (prev. 39.3K)
- New Zealand Business NZ Manufacturing PMI Dec: 54.5 (prev. 54.5)
- New Zealand Building Permits (MoM) Nov: -9.2% (rev. prev. 2.0% from 2.6%)
- New Zealand ANZ Consumer Confidence (MoM) Jan: 3.4% (prev. -2.10%)
- UK RICS House Price Balance Dec: 24% (est. 30%, rev prev. 29%)
- PBOC set USD/CNY mid-point at 6.8568 (prev. fix 6.8525, prev close 6.8432)
- BOJ to consider upgrading growth forecast, but remains cautious on inflation
- Asian shares down, dollar jumps on Yellen's rate hike signal – RTRS
- China says can resolve trade disputes with new U.S. government – RTRS
- Oil rises from one-week low, U.S. inventory data in focus – RTRS
Markets Update:
The US Dollar rose after hawkish comments from Fed Chair Yellen who said that the US economy was has met full employment. The biggest gain was seen against the Japanese Yen, as USD/JPY rallied from 113.20 to a high of almost 115. The Euro and the Pound came under pressure as well, with EUR/USD falling to 1.0620 and GBP/USD to 1.2250. Solid support is seen at 1.0570 and 1.2230 respectively.
The main event overnight was the release of the Australian employment data. The headline figure arrived higher than expected at 13.5k, but the employment rate increased from 5.7 % to 5.8 % while full-employment change only increased 9.3k. The reaction in the Australian Dollar was mixed. It initially fell from 0.7515 to 0.7490, but retraced those losses later in the session.
Today, the ECB is deciding on interest rates. The market is not expecting any change in rates or the size of their quantitative easing programme, so the focus will be on the press conference held by Draghi.
Upcoming Events:
- 09:00 GMT – Euro Zone Current Account
- 12:45 GMT – ECB Rate Decision
- 13:30 GMT – ECB Press Conference
- 13:30 GMT – US Building Permits
- 13:30 GMT – US Housing Starts
- 13:30 GMT – US Initial Jobless Claims
