The G-10 rundown
USD – strength remains relatively broad as USD safe haven certainly retained its credibility yesterday. Trump’s trashing of the Fed seems to offer less pressure than it has before. US Retail Sales today – an indicator that has had a run of positive prints over the last four months.
EUR – concerns that the EU economy is slipping and that a fiscal response will be weak and late seeing the euro fading lower versus the USD.
JPY – strength in long yields driving yen strength here, though still somewhat underperforming its normal potential, given the magnitude of yesterday’s downdraft in risk.
GBP – strong jobs data yesterday takes the edge off immediate economic concerns while the market still frets hard Brexit risks.
CHF – tracking the ups and downs of risk off here with no fresh pressure from Brexit woes or EU existential worries. USDCHF a bit interesting as it has put up a fight in not allowing the 0.9700 area to fall.
AUD – a solid jobs report overnight keeps the pressure off the RBA to cut rates sooner rather than later, and allows a bit of AUD resilience in the crosses. AUD downside versus safe havens making little progress despite ugly risk off yesterday – a bit of a warning sign?
CAD – under pressure from the latest risk deleveraging and weak oil prices – and Bank of Canada won’t want to be the odd one out if Fed forced to cut aggressively – watching the recent highs in USDCAD with interest for possible quick spillover toward 1.3500+ on a break.
NZD – AUDNZD trying desperately again to make itself interesting after the solid Australia jobs report overnight – needs to stick higher here above 200-day moving average to maintain immediate upside focus.
SEK – SEK trading passively to risk appetite, with yesterday’s risk off putting an emphatic local low on the EURSEK chart.
NOK – Norges Bank up this morning, where we are looking for a downshift in the Norges Bank’s guidance on further rate hikes – too out of touch with what is going on in the rest of the world. This could drive new all-time highs for EURNOK if we see another round of risk-off and weaker crude oil prices.
Upcoming Economic Calendar Highlights (all times GMT)
- 0800 – Norway Norges Bank Rate Announcement
- 0830 – UK Jul. Retail Sales
- 1230 – US Aug. Empire Manufacturing
- 1230 – US Q2 Nonfarm Productivity and Unit Labor Costs
- 1230 – US Philadelphia Fed Survey
- 1230 – US Jul. Retail Sales
- 1230 – US Weekly Initial Jobless Claims
- 1315 – US Jul. Industrial Production and Capacity Utilization
- 1400 – US Aug. NAHB Housing Market Index
- 1800 – Mexico Central Bank Interest Rate