Bets on Fed Cut Surged on China’s Coronavirus Outbreak; Stocks, Yields & Dollar Tumbled
Fear of China's coronavirus outbreak was the major theme in the global markets last week. At the time of writing, number of confirmed cases were close to 12000. While the majority of the infected in China, the virus has spread to at least 23 countries already. And, most important,...
CFTC Commitments of Traders – Safe-Haven Currencies Shined as Novel Coronavirus Exported from China sparks Global Worries
Safe-haven currencies shined as novel coronavirus exported from China sparks global worries. As suggested in the CFTC Commitments of Traders report in the week ended January 28. NET LENGTH in USD Index added +3 493 contracts to 16 433. Speculative long positions were gained +2 982 contracts and short...
CFTC Commitments of Traders – NET LENGTH on Crude oil Futures Fell Sharply as Price Slumped on Coronavirus Concerns
According to the CFTC Commitments of Traders report for the week ended January 28. NET LENGTH for crude oil futures declined -58 806 contracts to 461 762 for the week. Speculative long positions fell -10 973 contracts while shorts rose +47 833 contracts. For refined oil products, NET LENGTH...
Dollar Mildly Lower after PCE Inflation, But Commodity Currencies Even Weaker
Dollar turns slightly weaker in early US session as core PCE inflation data stayed well below Fed's target. Nevertheless, as risk aversion remains in the markets, commodity currencies continue to be the weakest ones. Sterling continues to rise on post BoE rebound but there is no clear range breakout...
Yen and Swiss France Consolidate ahead of Weekend, Await Coronavirus Outbreak Developments
Sterling remains firm today and continues to trade as one of the strongest after yesterday's BoE hold. Yen and Swiss Franc turn mildly softer but stay as two of the strongest too, on risk aversion. Commodity currencies turned mix, digesting this week's sharp looses. New Zealand Dollar is the...
BOE Voted 7-2 to Keep Rate Unchanged, Warned of Weak Inflation
BOE kept the Bank rate unchanged at 0.75% but revised lower GDP growth and inflation forecasts. British pound strengthened against US dollar as the Committee voted 7-2 for the decision. The market had anticipated more members to support rate cut. Once again, Michael Saunders and Jonathan Haskel favored lowering...
Sterling Rebounds after BoE Stands Pat, Coronavirus Fears Remain
Sterling surges broadly today after BoE left interest rates unchanged at 0.75%. Only two policymakers, the usual ones, voted for a cut, without additional dove. Swiss Franc and Yen follow as next strongest on coronavirus fears. An Italian cruise ship with 7000 people is held off the coast for...
Risk Aversion Back after a Breather, Coronavirus Cases Top 7700
Risk aversion is back in the markets after taking a breather yesterday, as there remains no sign of containment of China's coronavirus. Yen and Swiss Franc are the strongest ones today, with Yen pressing this week's high against other major currencies. Dollar is mixed shrugging off the non-eventful FOMC...
US Crude Inventory Gained over 3M bpd, while Distillate Stockpile Continued to Retreat from 2.5-Year High
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks added +1 mmb to 1295.4 mmb in the week ended January 24. Crude oil inventory gained +3.55 mmb (consensus: +0.48 mmb) to 431.65 mmb. Stockpile rose in 4 out...
Fed Delivered Message with Dovish Tweak, Remaining Concerned about Low Inflation
FOMC left the Fed funds rate unchanged at 1.50-1.75% as widely anticipated. The accompanying statement contained few changes which were skewed to a mildly dovish side. Given the Fed’s dissatisfaction over weak inflation and uncertainty over global growth, the market has now priced in over 80% that the Fed...
Dollar & Yen Firmer as Investors Hold Their Hands on Coronavirus Uncertainty
While risk sentiments stabilize today, there is no clear momentum of any meaningful recovery in global stock markets. Investors remain on guard against new developments of China's coronavirus outbreak, which confirmed cases exceed 2003's SARS already. Yen and Dollar trading generally firmer today, as in early US session. Though,...
Aussie Recovers after CPI as Markets Stabilized, FOMC Watched
Sentiments continue to be relatively stable in Asian session today. Hong Kong stocks are back from holiday and tumble sharply. But Nikkei and Singapore Strait times are having mild recovery. Gold is back below 1570 level and WTI crude oil is back at 54. In the currency markets, Australian...
Sterling Under Pressure While Market Sentiments Stabilized for Now
Risk sentiments stabilize some what today as markets are digesting the impact of China's coronavirus outbreak. But there is no clear sign of a turn around in the markets yet. Commodity currencies are just consolidating at low levels. Yen is also staying in tight range close to this week's...
Coronavirus Fear Continues as Confirmed Cases Surge, Forex Markets Taking a Breath
Risk aversion continues in Asian markets as outbreak of China's coronavirus shows now sign of slowing. But the moves in the currency markets seem to have passed a climax. Commodity currencies are consolidating in tight range close to week lows now. Yen, Swiss and Dollar are also digesting some...
Global Stocks in Crash Mode on Coronavirus, Commodity Currencies Pressured
Global stock market could be considered in crash mode as worries over China's coronavirus continues to intensify. Confirmed infections in China jumped to 2835, according to latest information from state media. Death toll continues to stand at 81. WHO Director-General Tedros Adhanom Ghebreyesus is heading to Beijing to offer...
Chance of BOE Rate Cut Balanced, as Weak Inflation is Offset by Strong Business Sentiment and Job Market
The market is mixed regarding whether BOE will lower the Bank rate at the upcoming meeting. Now the dust has settled for Brexit, the focus is turned to BOE’s monetary policy decision. Weakening in inflation suggests that a rate cut might be appropriate. Meanwhile, a cut in governor Mark...
Coronavirus Worries Intensify; Stocks, Oil & Yuan Fall; Yen, Swiss & Gold Jump
The holiday market in Asia is in deep risk aversion as worries on China's coronavirus intensified, after surge in confirmed cases and death tolls. Yen and Swiss Franc jump notably while New Zealand and Australian Dollars weaken. Risk aversion is also clearly seen as gold gaps up, oil price...
FOMC to Stay Put this Week
It is widely expected that the Fed will leave the policy rate unchanged at 1.5-1.75% at the January meeting. Meanwhile, we believe the accompanying statement will contain only minor change from the one in December. Major economic data will be released days after the FOMC meeting. Yet, the Fed...
Markets Sold Off on Coronavirus Worries, Dollar Momentum to be Capped by Yen Strength
China's new coronavirus overshadowed central bank activities last week and prompted global risk aversion. At the timing of writing, death toll jumped to 41 while more than 1300 people have been infected globally. The virus has already spread from Wuhan to other major cities in China, and globally to...
CFTC Commitments of Traders – NET LENGTH on DXY Futures Dropped
As suggested in the CFTC Commitments of Traders report in the week ended January 21. NET LENGTH in USD Index slipped -323 contracts to 12 940. Speculative long positions were down -256 contracts and short positions added +67 contracts. Concerning European currencies, NET SHORT for EUR futures dropped -1...