Global Markets:
- Asian stock markets: Nikkei down 0.95 %, Shanghai Composite gained 0.15 %, Hang Seng declined 0.10 %, ASX lost 0.08 %
- Commodities: WTI Oil at $52.15 (-0.17 %), Brent Oil at $55.09 (-0.02 %), Gold at $1196.85 (+0.02 %), Silver at $16.85 (+0.12 %)
- Rates: US 10-year yield at 2.34, UK 10-year yield at 1.34, German 10-year yield at 0.25
News & Data:
- Japan BoP Current Account Balance (JPY) (Nov): 1415.5bn (est 1460.0bn, prev 1719.9bn)
- Japan BoP Current Account Adjusted (JPY) (Nov): 1799.6bn (est 1870.4bn, prev 1928.9bn)
- Japan Bank Lending Ex-Trusts (YoY) (Dec): 2.60% (est 2.50%, prev 2.40%)
- Japan Trade Balance BoP Basis (JPY) (Nov): 313.4bn (est 254.4bn, prev 587.6bn)
- New Zealand ANZ Commodity Price Index (MoM) (Dec): +0.7% (prev rev to +3.2% from +2.70%)
- Brazil cut Selic rate by 75bps to 13.00% (est. 13.25%, prev. 13.75%)
- Dollar loses altitude, Asia shares at 11-week top – RTRS
- Oil dips on rising U.S. crude inventories, plentiful global supplies – RTRS
- Dollar slumps after Trump offers no details on economic policies – RTRS
Markets Update:
The US Dollar weakened sharply after the press conference held by US President-elect Donald Trump. The market was anticipating some details about Trump’s economic plans, but received none, which led to covering of USD long positions.
Heavy selling was seen in USD/JPY, which fell to a low of 114.27 at one point. It recovered slightly later, but ran out of momentum above 115.50 and eventually declined back to 114.40 in Asia.
EUR/USD rallied above 1.06, but once again failed to take out resistance at 1.0620. Key support is now seen at 1.0565/70, and a break below would confirm the third rejection off 1.0620, suggesting the Euro is heading back towards 1.04.
GBP/USD rallied as far as 1.2270 yesterday, but retraced back to 1.2170 in Asia. On-going concerns about a hard Brexit will likely continue to prevent any larger gains in the near-term.
The Australian Dollar is looking strong. AUD/USD rallied from 0.7430 to 0.7470 in Asia, and resistance is now seen in the 0.7500-20 area. A break above would signal a move towards 0.78.
Upcoming Events:
- 09:00 GMT – Italian Industrial Production
- 10:00 GMT – Euro Zone Industrial Production
- 12:30 GMT – ECB Meeting Minutes
- 13:30 GMT – US Initial Jobless Claims
- 14:15 GMT – Bank of England Governor Carney speaks
- 17:30 GMT – FOMC Member Lockhart speaks
- 18:15 GMT – FOMC Member Bullard speaks
- 18:45 GMT – FOMC Member Kaplan speaks
