CFTC Commitments of Traders – Improved Risk Appetite Lifted Bets on Oil Prices
According to the CFTC Commitments of Traders report for the week ended December 10. NET LENGTH for crude oil futures jumped +67 504 contracts to 495 539 for the week. Speculative long positions gained +46 096 contracts while shorts declined -21 408 contracts. For refined oil products, NET LENGTH...
Dissatisfied With Tiny US-China Tariff Rollbacks, Risk Appetite Might Struggle to Push Forward
The markets were rocked by three key events last week, UK Election, US-China trade deal and FOMC rate decision. Sterling ended as the strongest one last week as boosted by the Conservative's landslide victory in UK election, removing a large of of Brexit uncertainty. Canadian Dollar followed crude oil...
US-China Tariffs Rollback in Question, Sterling Firm on Brexit Certainty
Sterling remains undoubtedly the strongest one for today, and the week, cheering Conservative's landslide victory in UK elections. Boris Johnson pledged that "we will get Brexit done on time by the 31st of January, no ifs, no buts, no maybes." That's what markets are firmly believing in now. Meanwhile,...
Markets in Ecstasy on UK Election and US-China Trade Deal
Sterling strengthens broadly today as an important hurdle for Brexit is cleared with Conservative's landslide victory in the UK election. Yen and Swiss Franc are broadly pressured on return of risk appetite, helped also by completion of US-China trade deal phase one. Over the week, the Pound is the...
Lagarde Carries On Draghi’s Legacy at ECB
At the first ECB led by Christine Lagarde, the members decided to leave the deposit rate unchanged at -0.5%. Meanwhile, the main refi rate and marginal lending rate also stay unchanged at 0% and 0.25%, respectively. The pace of the asset purchase program, effective on November 1, also stays...
Euro Firm after ECB, Dollar Slightly Lower after Poor Jobless Claims
Both Euro and Swiss Franc are generally firm today after ECB and SNB rate decisions, as not much reactions are being triggered. Though, as for today, Australian Dollar is the strongest one so far. Sterling, on the other hand, pares back some of recent gains as traders lighten up...
SNB Maintains World’s Lowest Policy Rate
SNB left the policy rate unchanged at -0.75% in December. Again, the members reiterated the commitments to intervene in the currency in order to curb the appreciation of Swiss franc, which is described as “highly-valued”. They also affirmed to maintain the expansionary monetary policy so as to lift inflation...
Dollar Dives as Fed Might Not Hike Until after 2022, ECB and SNB Next
Dollar was sold off deeply overnight after Fed left interest rate unchanged. Most importantly, Fed chair Jerome Powell indicated that there is no need for any rate hike unless inflation materially surprises on the upside. Considering that Fed projects inflation to be around target through 2022, interest rate might...
US Crude Oil and Petroleum Gained in Stockpile
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks soared +17.22 mmb to 1281.05 mmb in the week ended December 6. Crude oil inventory increased +0.82 mmb (consensus: -2.76 mmb). Inventory gained in 3 out of 5 PADDs....
Fed Set a Neutral Tone and Signaled that Rate will Stay Unchanged Throughout 2020
As widely anticipated, FOMC left the Fed funds rate unchanged at 1.5-1.75% in December. Trying to deliver a neutral tone, there were only few changes in the policy statement and the updated economic projections. The median dot plot shows that the members expect the policy rate to remain the...
Dollar Shrugs Higher Than Expected CPI, Awaits FOMC
Dollar shrugs off slightly better than expected consumer inflation data and weakens mildly in early US session. But loss is limited as focus turns to FOMC rate decision, statement and new economic projections. At this point, European majors are generally weak as markets also look forward to tomorrow's UK...
Sterling Retreats on Last YouGov Poll, Dollar Await CPI and Fed
Sterling trades generally lower today after latest YouGov polls showed there is still possibility of a hung parliament after Thursday's election. Though, loss is relatively limited as a Conservative majority remains the base case. For now, focus will firstly turn to FOMC rate decision and economic projections. As Fed...
Markets Staying in Risk Off Mode Despite News of US-China Tariffs Delay
Global stock markets are generally under pressure today. There is some lift from a WSJ report that US and China are laying the ground work for a delay in December 15 tranche of tariffs But the recovery in sentiment is so far limited. In the currency markets, Australian and...
Markets Staying in Tight Range as UK GDP and German ZEW Awaited
Trading in the forex markets remain quiet in Asian session today, with major pairs and crosses staying in yesterday's range. Canadian Dollar is lifted mildly by positive news regarding USMCA, but gains are so far limited. New Zealand Dollar is, for now, the strongest one, followed by Sterling. On...
China’s CPI Soared to +4.5%; Exports Contracted More than Expected
Headline CPI in China accelerated to +4.5% y/y in November, from +3.8% a month ago. The key contributor to strong inflation is fresh vegetable and pork prices. Non-food price climbed +1% y/y from +0.9% in October. Excluding food and energy prices, core inflation steadied at +1.4% y/y. Upstream PPI...
Euro Rises Mildly as Investor Confidence Improved, Overall Markets Quiet
Markets continue to trade in rather subdued manner today, awaiting the key events ahead, including three central bank meetings, trade deal and UK elections. Meanwhile, Euro is trading generally higher, slightly, as supported by improvement in investor confidence. Sterling is also firm but fails to extend earlier gains. On...
Sterling Rises as Conservative Extends Lead ahead of Elections
Sterling strengthen broadly in relatively quiet markets today. Ahead of Thursday's election, Conservative's lead over Labour jumped back to 14pts according to a latest poll. Traders continue to be optimistic on a Conservative majority to finally rectify the EU withdrawal agreement for Brexit. While US stocks jumped sharply on...
Fed to Leave Policy Rate Unchanged in December, and Likely for 2020
We expect the FOMC will leave the Fed funds rate unchanged at 1.5-1.75% in December. The employment report released last week confirmed a resilient job market. Other indicators showed little deviation from the trend observed in October. Indeed, unless global and domestic conditions deteriorate materially, it is likely that...
CFTC Commitments of Traders – Commodity Currencies Gained Support while Safe-Haven Currencies Lost Ground
As suggested in the CFTC Commitments of Traders report in the week ended December 3. NET LENGTH in USD Index slipped -261 contracts to 23 877. Speculative long positions added +1 949 contracts and short positions gained +2 210 contracts. Concerning European currencies, NET SHORT for EUR futures rose...
CFTC Commitments of Traders – Bets for Higher Crude Oil Price Could Continue as OPEC+ Agreed to Cut Deeper
According to the CFTC Commitments of Traders report for the week ended December 3, NET LENGTH for crude oil futures declined -42 901 contracts to 428 035 for the week. Speculative long positions fell -22 617 contracts while shorts gained +20 284 contracts. On December 5, OPEC+ agreed to...