RBNZ Preview – Raising Rate as Least Regrets Option
The market has priced in a 25 bps hike, bringing the OCR to 0.5%, at this week’s RBNZ meeting. Much stronger-than-expected economic recovery since the last meeting, the rapidly rising inflation and inflation expectations, and a better job market are the key reasons for the rate increase. Signs of...
Yen Rises on Weak China Data, Strong Delta Spread
Yen rises broadly in Asian session on a couple of risk off factor, all linked to the pandemic. The set of weaker than expected data from China suggested that recovery is losing much momentum as the coronavirus is back. Japan reported surge in infections while Australia is also back...
CFTC Commitments of Traders – Traders Bet Aussie to Go Lower as Resurgence of Pandemic Triggers Lockdown Extension
As suggested in the CFTC Commitments of Traders report in the week ended August 10, NET SHORT of USD index futures added +445 contracts to 19 326. Speculative long positions rose +2 514 contracts while shorts increased +2 069 contracts. Concerning European currencies, NET LENGTH in EUR futures fell...
CFTC Commitments of Traders – Bets on Higher Crude Oil Price Shrank as Widespread Coronavirus could Again Hurt Chinese Demand
According to the CFTC Commitments of Traders report for the week ended August 10. NET LENGTH for crude oil futures slumped -30 114 contracts to 400 413 for the week. Speculative long position sank -27 408 contracts, while shorts increased +2 706 contracts. As we had anticipated, the sharp...
Slowing Core Inflation, Deteriorating Consumer Sentiment, and Split Fed
It's all about the consumers. After slowing core inflation and sharp deterioration in sentiment, Dollar took a steep dive towards the end of the week. Markets are suddenly less sure about a tapering announcement by Fed in September, not to mention anything concrete from Jackson Hole symposium later in...
EUR/USD Rebounds ahead of Weekend, Confirming Short Term Bottoming?
Euro and Swiss Franc rise broadly as the markets are approaching the weekly close. On the other hand, Canadian Dollar is reversing some of this week's gains, while Dollar is following as second weakest for the day. As for the week, the Loonie is still the strongest, followed by...
Sterling Turning Weaker in Crosses, Dollar Lacks Clear Direction
Trading in the Asian markets is relatively subdued again. Asian stocks are mixed even though DOW and S&P 500 rose to new record highs overnight. Dollar continues to fail to find a committed direction. While the greenback remains firm against Euro, Swiss Franc and Yen, it clearly lacks upside...
Dollar Regains Some Ground after PPI and Jobless Claims, Staying in Range
Dollar is trying to regain some ground in early US session after stronger than expected PPI. Both initial and continuing jobless claims also continued to trend lower. The greenback is followed by Euro and Yen while Aussie and Kiwi are softest. Though, major pairs and crosses are staying inside...
Crude Oil Price Recovered as US Inventory Resumed Decline. Outlook Remains Masked by Delta
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks slipped -0.14 mmb to 1267.52 mmb in the week ended August 6. Crude oil inventory resumed decline, falling-0.45 mmb (consensus: -1.27 mmb) to 438.78 mmb. Stockpile decreased in PADD...
Dollar Retreats as EUR/USD Tests 1.7 Support
The forex markets are generally trading in very tight range in Asian session. While DOW surged to new record high overnight, Asian indexes are just mixed. Dollar started a pull back but there is no clear follow through selling so far. At the same time, commodity currencies are generally...
Dollar Paring Gains after CPI Release, Commodity Currencies Jump with Stock Futures
Dollar drops notably in early US session after consumer inflation data. Headline CPI was steady while core CPI slowed a little. At least, inflation hasn't been worsening from Fed's "transitory rhetoric". US stock futures also jump, probably on reduced concerns over monetary tightening. New Zealand and Australian Dollars are...
Dollar Rally in Force as Focus Turns to CPI
Dollar's rally continues in Asian session today, in particular against Euro, Swiss Franc and Yen. Though, cautious comments from Fed Evans is not giving any particular boost elsewhere. Commodity currencies are still resilient, as supported by overall optimistic sentiment, with DOW closing at new record high. Main focus will...
Volatile Gold Price will Remain be Driven by Speculations of Fed’s Tapering
Gold trading is slim after Monday’s sharp selloff. Despite concerns over the delta variant, the precious metals lost their safe haven appeal as speculations over Fed’s early tapering escalated after the strong nonfarm payolls data. The front-month Comex gold contract slumped to a 4-month low of 1677.9 before settling...
Euro Falls after Sharp Fall in Economic Sentiment, Accelerating Lower
Euro falls broadly today after data showed surprised sharp fall in Germany and Eurozone economic sentiment. But at this point, Swiss Franc is even worse, while Yen is not far behind. On the other hand, Sterling and commodity currencies are trading generally higher, which much help from crosses. Dollar...
Dollar Extended Rally Tapering Talks, Staying Firm
Dollar's rally continued last week as supported by hawkish comments from Fed officials. Expectations for tapering this fall continued to build up. Swiss Franc is trading broadly lower, as the pull back against Euro accelerated. Meanwhile, Australian is also trading lower on poor business confidence data. Focus will turn...
Dollar Digesting Gains Awaiting Fed Speaks, Markets Turned Mixed
Overall markets are mixed today, as Dollar is digesting some of last week's gains, awaiting more guidance from FOMC members regarding tapering. New Zealand and Canadian Dollar are the stronger ones for now. But Australian Dollar is among the weakest together with Euro and Swiss France. Yen and Sterling...
China’s Mild Inflation Paves Way for Further PBOC Easing
Headline CPI eased to +1% y/y in July from +1.1% a month ago. From a month ago, inflation rose +5.3%, compared with +1.8% in June. This suggests that the slowdown in the year-over-year data was mainly due to high base. Food inflation contracted -3.7% y/y, after dropping -1.7% in...
Gold Smashed in Ultra Thin Trading, Dollar Slightly Firmer
While the currency markets are rather quite, big surprise is found in gold price, which smashed to as low as 1684, hitting the lowest level since March. Silver also tumbled to as an eight-month low of 22.5. The move was, for certain, exaggerated by the ultra thin Asian morning....
CFTC Commitments of Traders – Expect GBP Futures to Return to Net Long after Hawkish BOE
As suggested in the CFTC Commitments of Traders report in the week ended August 3, NET SHORT of USD index futures gained +2 340 contracts to 18 881. Speculative long positions added +1 703 contracts while shorts decreased -637 contracts. Concerning European currencies, NET LENGTH in EUR futures sank...
CFTC Commitments of Traders – Traders Sharply Trimmed Bets on Higher Crude Price
According to the CFTC Commitments of Traders report for the week ended August 3. NET LENGTH for crude oil futures sank -19 237 contracts to 430 527 for the week. Speculative long position declined -17 941 contracts, while shorts increased +1 296 contracts. Net length of WTI crude oil...