China’s GDP Growth Missed Consensus. Strong Activity Data Support Renminbi’s Outlook
The latest set of China's macroeconomic data is mixed in the headline. GDP growth in the third quarter came in below market expectation. However, major indicators such as industrial production, retail sales and fixed asset investment all beat consensus, confirming recovery is underway. Against this backdrop, we expect PBOC...
Chaotic Markets With Many Themes Going On
It's a rather chaotic week with many themes developing. The first October surprise of US President Donald Trump's coronavirus infects seemed to have fade as he's back in election campaign. Just as challenger Joe Biden appeared to be widening lead, according to mainstream polls, another October surprise surfaced with...
CFTC Commitments of Traders – USD Index Futures Drifted Back to NET LENGTH as Greenback Rebounded
As suggested in the CFTC Commitments of Traders report in the week ended October 13, USD Index futures drifted to NET LENGTH of 437 contracts. Speculative long positions increased +1 601 contracts and short positions dropped -1 870 contracts. It is likely that NET LENGTH will increase further in...
CFTC Commitments of Traders – Bets of Lower Gold Price Markedly Increaed
WTI crude oil price fluctuated about US$40/bbl last week. Latest forecasts from major oil agencies suggest that impacts of the pandemic on demand will be long-lasting. This could be a barrier for price to go higher. Bets on gold increased in both directions. However, short positions more than doubled...
Sterling Range Bound after Volatility, Brexit Talks Still Going to Continue
Sterling is a focus today in otherwise relatively quiet markets. Brexit jitters triggered much volatility in the Pound. But it's staying in range as, after all, negations between UK and EU will still continue next week, probably with some intensifications. As for the week, Australian Dollar remains the weakest...
Dollar & Yen Firm, But More Needed to Prove Their Strength
Dollar and Yen remain generally firm in Asian session while Australian and New Zealand Dollars are soft. US stocks pared back much of the initial losses overnight with DOW ended nearly flat. Overall sentiments are also stable and mixed in Asia only. Coronavirus infections and politics, like US election...
US Crude Oil Inventory Declined Further. Distillate Stockpile Dived on Demand Recovery
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks plunged -16.8 mmb to 1402.34 mmb in the week ended October 9. Crude oil inventory fell -3.82 mmb (consensus: -2.84 mmb) to 489.11 mmb. Stockpile gained in 3 out...
Safe Haven Flows Back to Dollar, Yen and Bonds
Risk aversion is currently in driving seat in the markets today. In the US, hope of fresh fiscal stimulus fades for now, most likely not until after elections. In Europe, countries are going back into lockdowns as coronavirus cases hit records. Negative sentiment drive global stock indices lower and...
Aussie Weakens Broadly as RBA Hints on Further Easing, Risk Sentiments Turn Soft
Australian Dollar drops broadly today after RBA hints at more monetary easing next month. It's also weighed down by mixed job data, as well as weaker risk sentiments. It now appears that US politicians won't agree to a new stimulus deal before election. US stock indices struggled to get...
China’s Inflation Weakened as Growth in Food Price Decelerated. Subdued Core CPI Evidenced Domestic Economy Not Yet Out of the Woods
China’s headline CPI moderated to +1.7% y/y in September, from +2.4% a month ago. This has missed consensus of +1.9%. The weakness was mainly driven by pork inflation which slowed to +25.5% y/y, from +52.6% in August. This contributed about 0.7 percentage point to headline CPI’s moderation. Fresh vegetable...
Sterling Powers Up after Initial Dip, Dollar Recovery Fades
Sterling had a roller coaster ride today, dropped notably on concerns over the deadlock in Brexit negotiations. Though, it then rebounded on talks that UK is still going to engage in talks after its self imposed mid-October deadline. Additional the country avoided a national coronavirus lockdown. The Pound is...
Dollar Struggling to Extend Rebound in Indecisive Markets
The markets are overall indecisive or the moment. US indices retreated mildly just ahead of record highs overnight. Mild softness is carried forward to Asian session. G20 finance leaders are seeing a less negative outlook for the global economy. Yet, the path forward remains highly uncertain depending on the...
Sterling Softens on Restrictions and Brexit Deadlock, Aussie Retreats Further
Sterling softens broadly today as UK unemployment rate rose more than expected while the part of the country is returning to restrictions. Additionally, there appears to be no progress on Brexit negotiation ahead of the EU summit later this week. Australian Dollar is the second weakest as China moves...
Dollar Recovering as J&J Paused Vaccine Study, Aussie Tumbles
Dollar is trying to recover in Asian session while Aussie tumbles broadly. Sentiments appear to be turning cautious on news that Johnson & Johnson paused coronavirus vaccine study due to an unexplained illness in a participant. UK also started a tiered system of fresh coronavirus restrictions. WTI crude oil...
OPEC+ Compliance Remains a Lingering Concern over Crude’s Demand/Supply Balance
The near-term outlook on crude oil price has turned sour, as supply is projected to rise despite high uncertainty in the demand outlook. Both crude oil benchmarks fell more than -2%, as Norwegian output resumes after strike, Libya supply is set to increase further and US production facilities restart...
Yen Rebounds in Quiet Markets, Politics to Drive the Week
Asian markets are trading in mixed most, decoupling from strong rally from the US on Friday. The forex markets are also steady. Yen is trading broadly higher and could be riding on the rebound against Dollar to strengthen elsewhere. Dollar is the currently the second strongest for today but...
PBOC Moves to Curb Renminbi’s Strength
PBOC announced over the weekend to lower the FX risk reserve ratio for forward foreign exchange sales from 20% to 0, effective October 12. The move is likely a response to the strength in renminbi (a.k.a. RMB, CNY). The central bank pledged to “maintain the flexibility of the RMB...
Dollar Tumbled as Investors Hungry for Risks, Down Trend Resuming?
Yen and Dollar ended the week as overwhelmingly the worst performing ones. Despite all the jitters regarding US President Donald Trump's coronavirus infections, stimulus talks stalemate, major stock indices ended the week strongly higher. Yen is additionally pressured by strong rally in treasury yields too.
On the other hand, Canadian...
CFTC Commitments of Traders – NET LENGTH on EUR Futures Slumped although Price Climbed Higher
As suggested in the CFTC Commitments of Traders report in the week ended October 6, NET SHORT for USD Index futures dropped further, by -2 521 to 3 034 contracts. Speculative long positions increased +3 669 contracts and short positions added +1 148 contracts. Concerning European currencies, NET LENGTH...
CFTC Commitments of Traders – Traders Bet Natural Gas Price to Rise. Demand could Increase as Weather Gets Cooler
According to the CFTC Commitments of Traders report for the week ended October 6, NET LENGTH for crude oil futures gained +9 625 contracts to 471 536 for the week. Speculative long position jumped +9 165 contracts, while shorts dropped -460 contracts. For refined oil products, NET LENGTH for...