RBNZ Preview: Expect QE Size Expansion and More Discussion on Negative Rates
We expect RBNZ to leave the OCR unchanged at 0.25% this week. It will likely increase the size of the Large-Scale Asset Purchase (LSAP) Program (QE) to NZD 80-90B from the current NZD 60B. The accompanying statement would contain a dovish tone, with policymakers discussing more alternative policy tools...
CFTC Commitments of Traders – Gold’s Net Length Climbed Slightly as Short Positions Emerged after Weeks’ of Rally
According to the CFTC Commitments of Traders report for the week ended August 4, NET LENGTH for crude oil futures gained +3 697 contracts to 536 266 for the week. Speculative long position rose +16 930 contracts, while shorts gained +13 233. For refined oil products, NET LENGTH for...
CFTC Commitments of Traders – Traders Trimmed Bets on USD amidst Hopes of Recovery
As suggested in the CFTC Commitments of Traders report in the week ended August 4, NET SHORT for USD Index futures decreased -252 to 6 475 contracts. Bets fell on both sides as the greenback is still finding bottom after losing almost -10% against a basket of currencies since...
Dollar Trying For Rebound after Trump’s Combination Move Against CCP
Dollar was under pressure most of the week on risk-on sentiments. NASDAQ gapped higher and marched to new record highs. Nevertheless, the greenback staged a notable comeback after combination move by the US administration against the Chinese Communist Party, with bans on TikTok and WeChat, as well as sanction...
Dollar Shrugs Better Than Expected NFP, Still Struggling to Extend Rebound
Reactions to the better than expected job data from US and Canada are rather muted. The greenback is currently trying to extend recovery. Yet, it's still the worst performing one for the week. Eyes remain on developments of US-China relations. But it probably takes a bit more time for...
China’s Trade Surplus Widened in July, Trade Deal Review Next Week In Focus
China’s trade data surprised to the upside in July. This was mainly driven by strong exports, offsetting decline in imports. Exports gained +7.2% y/y in July, following a 0.5% increase a month. This has beaten consensus of a -0.6% drop. From a month ago, exports rose +5.7$, after climbing...
Dollar Recovers on US-China Tech War, But Big NFP Challenge Ahead
The markets turn into mild risk-off mode in Asia, after US President Donald Trump stepped up the tech war with China, by banning TikTok and WeChat. Commodity currencies are generally lower as lead by Australian Dollar. On the other hand, Dollar and Yen strengthen broadly. Nevertheless, for the week,...
Dollar Stabilizes after Jobless Claims, But No Rebound Yet
Sterling remain remains the strongest one for today, as it's maintaining post BoE gains. Nevertheless, there is no apparent follow through buying after the initial surge. On the other hand, Dollar appears to be stabilizing mildly, and it's receiving some support from better than expected jobless claims. Though, the...
Sterling Lifted after BoE, Dollar Remains the Worst One for the Week
Sterling strengthens generally today after BoE stands pat. Even though investments remained weak, the central offered some optimism in the way that spending recovered significantly. At this point, Euro is the second strongest, followed by Yen. New Zealand Dollar and Canadian are the weaker ones. For the week, however,...
US Crude Oil Inventory Sank for Second Consecutive Week, While Refined Product Stocks Increased
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks fell -2.11 mmb to 1452.57 mmb in the week ended July 31. Crude oil inventory declined -7.37 mmb (consensus: -3 mmb) to 518.6 mmb. Stockpile fell in 3 out...
Dollar Selloff Intensifies after Huge Miss of ADP Job Data
Dollar's selloff intensifies in early US session after ADP job report hugely missed expectations. The strong upward revision in prior month's figure just make the picture looks worse, exaggeration the steep slowdown in labor market rebound. At this point, Yen is following the greenback as then second weakest, then...
Gold Breaks US$2000/oz as US dollar Loses Credibility as Reserve Currency
Breaking yet another new record, gold price has surpassed psychological level US$2000/oz. As we mentioned in last week’s report, the key drivers for the rally are low real yields and rising inflation expectations. Weakness is US dollar is another driver for the yellow metal's strength. However, the negative correlation...
Dollar Tumbles as Gold and NASDAQ Hit New Records
Dollar is back in selloff mode again after rebound attempt failed. The broad based trend against the greenback is clear, with gold hitting new record high above 2000 handle. WTI crude oil is also back above 41, pressing 42 handle. Overall risk-on sentiments, with NADSAQ making new record high,...
Dollar Having Another Rebound Attempt, Sterling Pulls Back
Dollar is having another rally attempt today and appears to be making some progress, at least against the relatively weaker Sterling. At this point, Swiss Franc is the strongest one, followed by the greenback. Australian Dollar is also firm after a non-eventful RBA rate decision. On the other hand,...
Aussie Firmer after RBA, Dollar Rebound Fades
Dollar turns soft again after momentum for rebound faded quickly. Euro and Swiss Franc are back in control even though they're still generally range bound. Australian Dollar is following closely after RBA stands pat as widely expected. Recovery is still expected and the central didn't sound concerned with recent...
RBA Cautioned over Uneven and Bumpy Recovery amidst Second Wave of Outbreak. Maintained All Easing Measures
At the July meeting, RBA left the cash rate unchanged at 0.25% and maintained yield curve targeting for 3-year bonds at 0.25%. While acknowledging that economic contraction has been less severe than previously anticipated, policymakers left economic forecasts largely intact. The cautiousness was driven by the latest round of...
BOE Preview – Expecting More Hint on Lowering ELB while Near-Term Outlook Might be Upgraded
BOE is widely anticipated to leave the Bank rate unchanged at record low of 0.1% this week. The asset purchase program (QE) will also be maintained at 745B pound. Of most interest in the meeting are the updated economic assessments, discussions on the effective lower bound (ELB) and negative...
Dollar Extending Recovery, Turning Around the Corner
Dollar starts the month with a much firmer footing, trading broadly higher as the strongest one so far. The rally is particular against Swiss Franc, which is currently the weakest one. Yet the greenback will firstly need to overcome some near term technical levels to convince traders about its...
Trading Subdued in Cautious Mood, Dollar Still Finding Momentum for Rebound
Trading in forex markets is rather subdued today in overall mixed mood. Better than expected manufacturing data provides little lift to sentiments. Coronavirus curfew in Australia's Victoria state is also shrugged off. Instead, traders are generally cautious ahead of a very busy week. RBA and BoE will meeting while...
RBA to Caution about Economic Impacts of Renewed Lockdown, Relying on Fiscal Policy for Stimulus
RBA will most likely leave all of its monetary policy measures unchanged in August.
The cash rate will stay on hold at 0.25%, the yield curve control program remains targeting 3-year government bonds at 0.25% and the Term Funding Facility will remain in place. However, the officials’ view on the...