The G-10 rundown
USD – continues to grind stronger – watching this week for Powell testimony before Congress and whether this creates any ripples.
EUR – EURUSD running out of room ahead of the cycle lows and we have strong concerns on the EU economy. Germany reported -8.7% year-on-year for Industrial Production in December on Friday, before any impact from the coronavirus, and Italy reported Industrial Production at -4.3% year-on-year for December.
JPY – the yen sluggish within the range here and only has a chance to raise eyebrows on a clean risk-off sweep (lower equities, lower safe haven bond yields).
GBP – sterling struggling as the EU has taken a tough line on trade deal negotiations and we still have another month’s wait for the UK budget, with the hope from sterling bulls that the confidence bounceback in the wake of the December election will show legs.
CHF – the EURCHF pair is dead in the water – looks bearish that such a steady run lower has shown such shallow consolidation. Defaulting to the view that CHF is lower beta to risk-on/risk-off behavior than JPY.
AUD – watching the commodity space and coronavirus fallout as the main factor here. Looks like the RBA wants to retain all further policy easing for damage control rather than as a prophylactic.
CAD – USDCAD pushing into the last shreds of the local range above 1.3330 on Friday, but has a bit more work to do to make a larger break – starting with the 1.3500-6 zone.
NZD – again, downside risks on a dovish tilt from the RBNZ this week, which could prove a wakeup moment in NZD crosses, especially now that NZDUSD broke badly lower yesterday.
SEK – a smart technical reversal in EURSEK s the attach through the 10.60-65 area has been rebuffed . But we need more traction on the EU and Swedish economic and fiscal policy outlooks to argue for a bigger SEK rally.
NOK – NOK trying to find its feet this morning after a blowout CPI number (leaping to 2.9% year-on-year for the core in January from 1.8% prior) as the country’s inflation levels are very sensitive to currency effects. But without a bigger boost to crude oil and durable removal of coronavirus concerns, NOK may be stuck in neutral or worse.
Upcoming Economic Calendar Highlights (all times GMT)
- 1315 – Canada Jan. Housing Starts
- 1330 – Canada Dec. Building Permits
- 2015 – US Fed’s Harker (Voter) to Speak
- 0030 – Australia Jan. NAB Business Survey