The G-10 rundown
USD – we saw a solid firming last week, but the USD strength has failed to add any momentum – a microcosm of the endless months of no directional impulses as the market cant seem to find a catalyst.
EUR – the euro in weak shape, needing positive catalysts on the policy front – or signs of economic recovery to deserve attention, although we are also interested in watching how the single currency behaves if the melt-up in risk currencies stumbles badly, though its outperformance here against the JPY suggests that the JPY remains the higher beta play on risk appetite swings.
JPY – USDJPY making a run at 110.00 this morning, but for better confirmation, we would like. Wondering if we see a near term peak in CNY and EM strength and therefore JPY weakness around the time of the US-China trade deal signing this week.
GBP – a BoE rate cut looks a done deal at one of the coming meetings, but is merely symbolic even if sterling negative – the UK needs a free trade deal with the EU and inbound investment, not rate cuts.
CHF – EURCHF has tested new lows for the cycle, but not looking impulsive here as the complacent backdrop doesn’t look supportive for testing the SNB’s resolve to defend against further CHF strength
AUD – AUDUSD suffered a bearish reversal last week and has back-filled to the 0.6925 pivot area – actually a sign of rather profound weakness that the hard-charging CNY hasn’t done more to support AUD. Considerable investment to come to deal with the bushfire aftermath that may flatter GDP numbers from here Down Under.
CAD – the loonie not responsive to the very positive Canadian December jobs numbers and huge drop back lower in the Canadian unemployment rate from 5.9% to 5.6%
NZD – the AUDNZD cross has executed a more determined reversal and looks tradable on the long side for bulls here to test the upper half of the medium term range.
SEK – the krona has only managed a bit of mean reversion on the Riksbank’s ending of its NIRP era and while the risk-positive backdrop is SEK-supportive, the ongoing growth struggles in Sweden and the EU continue to weigh. Next key resistance at 10.60-65 zone in EURSEK.
NOK – no pulse in EURNOK as it rides the underside of the 200-day moving average here – a move to 9.60-50 needs real signs of a global growth outlook perhaps more than mindless reach for yield.
Upcoming Economic Calendar Highlights (all times GMT)
- 0930 – UK Nov. Visible Trade Balance
- 0930 – UK Nov. Manufacturing Production
- 1500 – US Fed’s Rosengren (Non-voter) to speak
- 1530 – Canada Q4 BoC Business Survey
- 1740 – US Fed’s Bostic (Non-voter) to speak