The G-10 rundown
USD – the US dollar poking at its highest levels for the year in several USD pairs – with such low volatility, tough to fully get behind this move – need to see more on FOMC’s plans for its balance sheet for more conviction.
EUR – yesterday’s German January ZEW survey showed expectations vaulting to new highs since 2015, but if the story behind that reading, as reported, is that confidence is rising on the US-China trade deal outcome, we’re skeptical on the medium term implications. Next step
JPY – firm safe haven bond markets (new local lows in German bund yields, and US 10-year benchmark pressing on the important 1.75% area) offering the yen some support.
GBP – a very strong November paryolls surge offering sterling a helping hand yesterday, as odd for a BoE cut next week are adjusted marginally lower – sterling still has some work to do to get out of the range versus the EUR and especially the USD – 0.8450 to start in EURGBP.
CHF – EURCHF easing well off the lows and USDCHF has posted a smart reversal in recent days from new lows below the lowest 2019 levels – odd gyrations this morning in a likely thin market. The franc seems to be trading free of SNB influence.
AUD – the latest Australian jobs report up tonight after two months of zany swings in this erratic data series – the RBA is sensitive to labor market data and the last bushfire disaster has upped the odds of a Feb 4 RBA rate cut to better than 50/50 odds.
CAD – as noted above, a pivotal day today for USDCAD, which will take its cue from the Bank of Canada meeting and Poloz press conference – the trigger area around 1.3100 to the upside and 1.3000-25 to the downside.
NZD – the kiwi nudging at the lows for the year against the US dollar, but still room for NZDUSD to consolidate without reversing the significant upswing – next level there is 0.6500-15, the current 200-day SMA. Elsewhere, watching AUDNZD for further signs of support ahead of AU jobs data tonight and NZ Q4 CPI data late tomorrow for us in Europe (early Friday in Asia).
SEK – the krona largely inert here – fairly weak performance given the supportive backdrop – no real technical pressure until we are testing 10.60-65 or below 10.42.
NOK – short Norwegian rates have been ratcheting steadily lower in recent days as oil prices droop and as the sitting government has now lost its majority – is the market fearing an eventual left leaning government with green/anti-fossil fuel policies come the September 2021 election?
Today’s Economic Calendar Highlights
- 1330 – Canada Dec. CPI
- 1500 – Canada Bank of Canada Meeting
- 1500 – US Dec. Existing Home Sales
- 1615 – Canada Bank of Canada Governor Poloz
- 0030 – Australia Dec. Employment Change/ Dec. Unemployment Rate