Worsening Inflation, Dovish Central Banks and Falling Treasury Yields
Yen and Dollar were the biggest winners last week on worsening inflation outlook, dovish central banks and falling treasury yields. Australian Dollar was the weakest one as CPI just rose 1.3% yoy in Q1 versus expectation of 1.5% yoy. The added heavy weight to the case of RBA rate...
Strong US GDP With Weak Details Send Dollar Lower, 10-Yr Yield Breaks 2.5
Dollar spikes higher in early US session as Q1 GDP grew much more than market expectations. However, the greenback quickly pulled back as details are seen as much weaker than the headline number suggests. It's actually a set of data welcome by stock traders as Fed will likely stay...
Dollar and Yen Pare Gains as Focus Turns to US Q1 GDP
Commodity currencies recover broadly in Asian session as risk markets somewhat stabilized. US stocks closed mixed with DOW paring much of initial losses overnight. New Zealand Dollar is additional supported by record exports in March, and helps lift Australian too. Yen is the weakest so far for today, followed...
Strong Durable Goods Fail to Boost Dollar, Yen Taking the Driving Seat
Yen takes the driving seat from Dollar today as markets could be turning into risk averse mode. The greenback is still firm and remains the second strongest for the week. But strong US durable goods orders is not giving it enough boost to extend this week's rally. On the...
Dollar Surges on Flight to Quality Flows, EUR/USD Breaks Key Support
It appears that the global economy is now running at two different speed. US is maintaining firm momentum despite all the uncertainties and slowdown elsewhere. Strong corporate earnings provide evidence on underlying resilience. While global central banks are turning cautious or even dovish, there is little pressure for Fed...
BOC Erases Rate Hike Possibility in Near- to Medium- Term
BOC sent a mixed message in its April meeting. As shown in the accompanying statement, it has turned more dovish as it removed any chance of rate hike in the near- to medium- term. The central bank downgraded GDP growth forecast, both domestically and globally. It also lowered the...
US Crude Oil Inventory Increased Four Times More than Expected
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks surged +8.82 mmb to 1244.6 mmb in the week ended April 19. Crude oil inventory soared +5.48 mmb to 460.63 mmb (consensus: +1.26 mmb). Inventories rose in 4 out...
Euro Weakens as German 10-Year Yield Threatens to Turn Negative, Swiss Franc Rebound
Swiss Franc regains much ground today in mixed financial markets. Optimism over US corporate earnings had virtually no impact in Asian and European markets. Instead, European stocks turned mixed after German Ifo business confidence turned south again after brief recovery last month. German 10-year yield also suffers rather steep...
Australian Dollar in Free Fall after Big CPI Miss, BoC Watched Today
Australian Dollar is overwhelmingly the worst performing one today. It suffers heavy selling after much weaker than expected CPI raises the chance of RBA rate cut later this year. New Zealand Dollar follows as second as RBNZ is also expected to cut, just probably earlier in May. Canadian Dollar...
Dollar Surges Broadly on Earning Optimism, Gold Extends Decline
Dollar rises broadly in early US session as traders seem preparing for solid Q1 earnings reports in US. Stocks indices are relatively steady, though, with DOW, S&P 500 and NASDAQ up slightly in initial trading. But after all, improvement in the overall sentiments could revive the chance for a...
Forex Markets Tread Water as Impact of Oil Rally Fades
The forex markets remain relatively quiet in Asian session today. Canadian Dollar surged briefly yesterday as lifted by rally in oil price. WTI crude oil remains firm in at 65.80, after rising on news that US is ending Iranian oil sanction wavier for eight countries. But the boost to...
Canadian Dollar Pulled Higher by Oil, But Cautious ahead of BoC
Canadian Dollar open the week generally higher, as helped by strong rally in oil price, on supply concern. Though, the Loonie is generally bounded in range only. BoC rate decision and statement this week will be crucial to the next move. For now, risks are mildly on the upside...
CFTC Commitments of Traders – Net Length for Precious Metals Trimmed Markedly as Yields Soared
According to the CFTC Commitments of Traders report for the week ended April 16, NET LENGTH for crude oil futures dropped -1 404 contracts to 515 258 for the week. Speculative long positions fell -5 656 contracts while shorts dropped -4 252. Oil price rally might continue after Easter...
CFTC Commitments of Traders – Net Short Increased in Safe- Haven Currencies as Risk Appetite Improved
As suggested in the CFTC Commitments of Traders report in the week ended April 16, NET LENGTH in USD Index decreased -508 contracts to 28 938. Both speculative long and short positions dropped during the week. All other major currencies stayed in NET SHORT positions.
Concerning European currencies, NET...
Strong Retail Sales and Jobless Claims Boost Dollar, But Yen Outperforms
Dollar jumps broadly in early US session after very strong retail sales and jobless claims. Yen is the only one stronger than the greenback, thanks to pull back in global treasury yields. Euro, as well as benchmark German yield tumble as poor PMIs dent hope for a recovery in...
BOC to Look Through Strong March Inflation and Maintain Dovish Stance
At the BOC meeting next week, we expect Governor Stephen Poloz to reinstate the stance that the next policy rate move would be data-dependent. The latest inflation report surprised to the upside. Yet, the central bank would likely look through it as other data continued to show decelerating growth...
Eurozone PMIs, Retail Sales from UK, US and Canada Watched
Asian markets turned softer today, ahead of long weekend. Major indices are trading in slightly in red as traders lighten up positions. In the currency markets, Yen is so far the strongest one for today, naturally. Australian Dollar is the second strongest, as lifted slightly by solid employment data....
US Crude Oil Inventory Surprisingly Declined as Production and Imports Trimmed
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks surged +7.22 mmb to 1229.13 mmb in the week ended April 12. Crude oil inventory surprisingly dropped -1.4 mmb to 455.15 mmb (consensus: +1.71 mmb). Inventories declined in 3...
Canadian Dollar Jumps on CPI, Treasury Yields Rise on China Data
Global treasury yields are boosted by solid data from China today. German 10-year yield hit at high as 0.104 and is now back at around 0.08. US 10-year yield breaches hit 2.614 and it's now trying to own 2.6 handle. These are both signs of improvements in market sentiments...
Aussie Lifted by Strong China Data, Kiwi Tumbles on CPI and RBNZ Bets
Australian and New Zealand Dollars have very different fortunes today. Aussie was boosted higher by stronger than expected Chinese data. On the other hand, Kiwi dived as weaker than expected CPI raises the chance of RBNZ rate cut at next meeting. In between, Euro is the second strongest so...