The G-10 rundown
USD – staying strong on the weak risk appetite – need to see a bigger impulse move in EURUSD below support to talk about something more profound, however. Last night’s 30-year treasury auction went off well relative to the 10-year the prior day.
EUR – the difficult progress lower in EURUSD continues but we are all in suspense if we need a catalyst to take the rate below 1.1300.
JPY – paint is drying in USDJPY at the moment, but the strong US T-bond auction and risk off generally supportive of the JPY across the board.
GBP – sterling all over the map yesterday, first lower on the BoE’s “fog of Brexit” warnings and then higher on a story raising hopes that May might be making progress on the Irish backstop Gordian knot. Now we are essentially back to unchanged. Positioning in options seems the only option, with expiries post March 29.
CHF – risk off feeding further CHF strength versus the euro and the EU existential worry angle is creeping back into the picture as Italian BTP’s are under pressure from the EU’s downgrade of Italy’s growth outlook, which can only bring forward the next confrontation between Italy and EU over spending limits.
AUD – we remain negative on the outlook, but goodness if iron ore prices don’t come down soon we may need to reassess.
CAD – the USDCAD chart is turned and disappointed with AUDCAD and NZDCAD so far for relative outperformance, if not yet ready to give up. Canada’s latest jobs report and housing starts data up later today.
NZD – AUDNZD just can’t get anything going it seems – suspect yesterday’s immediate setback after the prior bounce down to the quicker reflex to sell the AUD.
SEK – Riksbank not in an enviable place next week. Only rout to hawkishness is in defense of the currency, not the economy – is the central bank in a bad enough place yet?
NOK – nothing to like here with the weak risk appetite and oil backdrops. Watching the 9.80-9.90 zone for possible resistance.
Upcoming Economic Calendar Highlights (all times GMT)
1030 – Russia Key Rate Announcement
1315 – Canada Jan. Housing Starts
1330 – Canada Jan. Unemployment Rate
1330 – Canada Jan. Net Change in Employment