BOC Revised Lower Growth Forecast for 2018, Sent a Mixed Message
BoC has sent a mixed message in yesterday's statement. Although the next rate adjustment remains a hike, the timing remains data-dependent and hinged on a number of uncertainties, including NAFTA negotiations and geopolitical tensions, something critical to Canada due to its position as oil exporter. Policymakers upgraded the assessment...
Oil Prices Extend Rally as US Inventories Unexpectedly Declined
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products stocks slumped -10.58 mmb to 1180.97 mmb in the week ended April 13. Crude oil inventory dropped -1.07 mmb to 427.57 mmb, amidst decreases in 3 out of 5 PADDs. Stockpile in...
Sterling Lost Ground and CPI Trend Raises Doubt on BoE May Hike
Sterling is the biggest loser today after CPI missed market expectations. Most importantly, it's the steep trend of slow down in inflation, from 3% in January to 2.5% in March that raised doubts on a BoE May hike. The Pound stabilized a bit after initial selloff. For the moment,...
UK CPI and BoC to Guide the Markets as Sentiments Improved
Markets sentiments turned positive as there were now continuous flow of bad news. All three of DOW, S&P 500 and NASDAQ closed higher overnight, with NASDAQ scoring the best performance. Technically, all three have taken out 55 day EMA decisively which suggests more near term upside. Nikkei follow and...
China Unexpectedly Loosens Monetary Policy by Cutting RRR
People’s Bank of China (PBOC) announced to cut 100 bps in the reserve requirement ratio (RRR), effective from April 25, for large commercial banks, joint-stock banks, city commercial banks, rural commercial banks, and foreign banks. While it would be applied to large and small-to -medium banks with current RRR...
US Oil Inventories Fell Across the Board
The industry- sponsored API estimated that crude oil inventory decreased -1 mmb in the week ended April 13. Cushing stock also dropped -1 mmb for the week. For refined oil products, gasoline stockpile declined -2.5 mmb while distillate slid -0.85 mmb for the week. The agency also estimated that...
Sterling and Euro Reverse Gains after Disappointing Data, Dollar Rebounds Broadly
Sterling and Euro strengthened earlier today but both reversed earlier gains after disappointing economic data. On the other hand, Dollar is trying to make a come back as buying accelerates in early US session. It's more a coincidence than a response. But the greenback picks up momentum after US...
China’s March Data Distorted by Holiday and Weather Effects
China’s macroeconomic data showed a mixed picture in March.
Growth in industrial production (IP) eased to +6% y/y, compared with consensus of +6.9% and January- February’s +7.2%. The inflation report released last week also showed that headline CPI slowed markedly to +2.1% y/y in March, from February’s +2.9%. Urban fixed...
Sterling Firm as Markets Look into UK Unemployment Rate and Wage Growth, Aussie Lower after RBA Minutes
Sterling retreats mildly in Asian session today, against Dollar, Euro and Yen. But it remains the strongest one for the week. The breach of 1.4345 resistance in GBP/USD overnight signals medium term up trend resumption. But the rally slowed a little bit above there. For now, GBP/JPY is limited...
Dollar Weak after Mixed Data, Sterling Shines
Dollar remains general weak in early US session after mixed economic data, in particular against European majors. The greenback does try to rebound against Australian Dollar and Canadian Dollar. But momentum is being capped. Yen also tried to rebound earlier today but quickly lost steam. Sterling is emerging as...
Singaporean Central Bank Turns Hawkish on Upward Core Inflation Pressure
The Monetary Authority of Singapore* (MAS) last Friday announced to increase the slope of the Singaporean dollar nominal effective exchange rate (SGD NEER) policy band “slightly”, the first adjustment since the policy tool was reduced to 0% in April 2016. As usual, the central bank did not disclose how...
Yen Making a Come Back in an Important Week for BoE and BoC
Yen is making a come back in Asian session today. The reaction to the Syria strike was muted. But risk aversion comes back with selloff in Chinese and Hong Kong stocks. Nikkei is maintaining slight gain of 0.25% at the time of writing. But China SSE and Hong Kong...
Traders Mixed on Oil as Prices Soared to Fresh 4-Year Highs
Speculators were mixed over the energy complex in the week ended April 10. Net LENGTH for crude oil futures rose +7 535 contracts from a week ago to 707 080. NET LENGTH of heating oil added +330 contracts to 14 31 while net LENGTH for gasoline plunged -7 566...
Yen and Franc Ended as the Weakest Ones as Risk Aversion Temporarily Eased, Reaction to Syria Strikes Watched
Easing risk aversion was the main theme last week as Japanese Yen and Swiss Franc ended as the weakest two. It's not the kind that investors were in euphoria. But nonetheless, major stock indices around the world ended up higher. Dollar ended as the third weakest despite markets firming...
Yen Selling Intensified, Dollar Supported by Hawkish Fed Rosengren
Yen continues to be the weakest one today as selloff intensifies in European session. Relieves from immediate risks are still as the major reason driving the Japanese currency down. Australian Dollar continues to be the strongest one with AUD/USD and EUR/AUD taking out key near term levels. Dollar was...
Australian Dollar Higher after China Data, EUR/AUD in Focus
Australian dollar strengthens broadly in Asia session as lifted mildly by China's trade data. The Aussie is also among the strongest ones for the week, together with Canadian Dollar and New Zealand Dollar. Euro suffered some selloff overnight, in particular against, Sterling. But the common currency quickly found footing...
Euro Tumbles after ECB Minutes, Dollar and Stocks Love Trump’s Uncertain Timing on Missile Strike
The financial markets don't always hate uncertainties. Sometimes, they embrace it. US President Donald Trump backed down from his initial tough stance on Syria, and it's now unsure when he will order firing of missiles over it. European equities cheered the newly created uncertainty with DAX turning initial loss...
Oil Prices Gained for Three Days in a Row, Despite Inventory Build
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products stocks soared +5.97 mmb to 1191.55 mmb in the week ended April 6. Crude oil inventory gained +3.31 mmb to 428.64 mmb, amidst increases in 4 out of 5 PADDs. Stockpile in...
Euro to Look into ECB Minutes for Guidance, Markets Steady in Asia
The Asian markets are relatively steady today as for now, there is no escalation in the situation in Syria. At the time of writing Nikkei is trading down -0.26% only while HK HSI is down -0.17%. Performance of US indices overnight were not too bad. DOW closed down 0.9%...
FOMC Minutes: Fiscal Stimulus During Full Employment Facilitates Inflation to Reach +2%
The FOMC minutes for the March meeting reinforced the members’ confidence over the economic growth outlook and that inflation would return to the +2% target in the medium-term. The confidence was mainly driven by the tax reform plan passed late last year as well as passage of the Federal...