Global Markets:
- Asian stock markets: Nikkei gained 1.60 %, Shanghai Composite rose 0.15 %, Hang Seng gained 1.40 %, ASX 200 closed for holiday
- Commodities: Gold at $1198 (+0.05 %), Silver at $16.95 (-0.20 %), WTI Oil at $53.20 (+0.90 %), Brent Oil at $55.55 (+0.90 %)
- Rates: US 10 year yield at 2.53, UK 10 year yield at 1.47, German 10 year yield at 0.47
News & Data:
- New Zealand CPI (YoY) Q4: 1/3% (est. 1.2%, prev. 0.4%)
- New Zealand CPI (QoQ) Q4: 0.4% (est. 0.3%, prev. 0.3%)
- Japan Services PPI (YoY) Dec: 0.4 % (est 0.3%, prev 0.3%)
- China Industrial Profits (YoY) Dec: 2.3% (prev. 14.50%); CNY 844.4bln
- PBOC sets USD/CNY mid-point at 6.8588 (prev. fix 6.8596, prev close 6.8818)
Markets Update:
The New Zealand Dollar rallied against most other major currencies overnight, following stronger than expected inflation data. New Zealand’s central bank will decide on interest rates in exactly two weeks, but is expected to leave the main rate unchanged. NZD/USD rallied from 0.7250 to 0.7310 following the inflation data release and consolidated in a 0.7280-0.7310 range for the rest of the session. Resistance is now seen at 0.74.
The Dollar remained weak in Asia. EUR/USD rose from 1.0745 to 1.0765, while GBP/USD extended gains to 1.2665. USD/JPY traded in a 113.05-45 range, and it is likely it will test 112.50 support again soon.
Asian stock markets rallied strongly, inspired by gains in the US markets, where the Dow Jones Index closed at a fresh record high. This put precious metals under pressure, with Gold declining back below $1200. Support is now seen at $1190, and a break below could signal that a deeper retracement lies ahead.
The main event today will be the release of UK GDP data, expected at 0.5 % q/q and 2.1 % y/y.
Upcoming Events:
- 09:30 GMT – UK GDP
- 13:30 GMT – US Initial Jobless Claims
- 14:45 GMT – US Services PMI
- 15:00 GMT – US New Home Sales
- 23:30 GMT – Japanese CPI
