US Oil Price Plunged to 2-Month Low as Inventory Surprisingly Surged
The front-month WTI crude oil contract slumped over 3% to settle at the lowest level in 2 months. This was the driven by the risk-off sentiment amidst Turkish crisis and the surprising increase in US inventory. The report from the US Energy Information Administration (EIA) shows that total crude...
Dollar Surges on Strong Retail Sales, But Yen Even Stronger on Risk Aversion
Dollar jumps higher in early US session as supported by strong retail sales data. But the greenback is once again outshone by Yen on risk aversion. At the time of writing, DAX is down -1.22%, CAC is down -1.19% and FTSE is down -1.17%. Earlier in Asia, Nikkei lost...
Dollar Power Higher as Renewed Selloff in China Yuan Weighs on Sentiments
Renewed selloff in the Chinese Yuan weighs down sentiments across Asia and boosts the greenback today. USD/CHN breaks recent high at 6.912 to resume up trend. With that, China Shanghai SSE is trading down -2.31% at the time of writing. Hong Kong HSI is down -1.52%, Singapore Strait Times...
No Rebound in Euro and Sterling after Mixed Data, Yen Retreat Continues
Some important economic data were released during the European session. But they provide little lift to Euro and Sterling. In particular, even though UK unemployment rate dropped to 43 year low, deceleration wage growth gives no pressure to BoE to hike again soon. German economic sentiment improved but still...
Impacts of Turkish Turmoil on Eurozone Limited. Yet, Market Sentiment is Contagious
Selloff in Turkish lira and euro has stabilized but the worst is not yet over. As we mentioned in the previous report, the ultimate reason for lira’s slide is President Recep Tayyip Erdogan's failed economic and monetary policy. The Turkish central bank TCMB, since his re-election as the President, ...
Dollar Ready to Take Control from Yen While Sentiments Remains Vulnerable
The forex markets are rather steady today. Turkish turmoil seemed to have passed its climax for the near term. Swiss Franc and Yen are trading lower as that part of risk aversion receded. Meanwhile, New Zealand, Canadian and Australian Dollar are generally higher, together with Sterling. Though, it remains...
Chinese Growth Continued to Shrink in July, Despite Stimulus Measures
July’s data showed that China’s economic growth continued to decelerate although the government has loosened its policy. All key economic activity indicators missed expectations for the month.
Industrial production grew +6% y/y, after a sharp slowdown in June and missing consensus of +6.3%. The moderation has been revealed in the...
Reactions to Rumor of Releasing American Pastor Shows Markets Ready for a Bounce
With a near empty economic calendar, the focus is entirely on development in Turkey. Turkish central bank's announcements did calm the markets. While USD/TRY breached 7.2 earlier, it dipped to as low as 6.4136 after CBRT's announcement. At the time of writing, it's back at 6.9 with an eye...
Turkish Lira Calmed by CBRT Announcements, But Stays Vulnerable
Turkish Lira continues to be the dominant theme in the financial markets today. The efforts by the government seemed to have calmed the markets a bit, in particular after CBRT's announcements. But at the time of writing, USD/TRY is still up more than 4% today at around 6.7. It's...
Traders Deepened Bets on Higher US Dollar; Long Positions for Safe Haven Currencies Might Turn Positive Next Week on Heightened Geopolitics
As suggested in the CFTC Commitments of Traders report in the week ended August 7, speculative long positions increased +1 039 contracts in USD index futures, while shorts dropped -607 contracts, resulting in an increase in NET LENGTH to 30 102 contracts for the week.
For European currencies, traders...
CFTC Commitments of Traders: Gold Lost Safe Asset Appeal
According to the CFTC Commitments of Traders report for the week ended August 7, traders turned less bullish towards the energy complex. They trimmed bets for crude oil and heating oil futures, while raising short positions on gasoline futures. Net LENGTH for crude oil futures fell -4 473 contracts...
Looking Through the Turkish Currency Crisis, Dollar is Strong Anyway
It was one of those wild week in the financial markets with a number of market moving themes. New Zealand Dollar was the worst performing one after RBNZ made itself clear that interest rate is going to stay low for longer. And the next move could either be up...
Dollar, Yen and Swiss Franc Surge as Turkish Crisis Prompts Flight to Safety
Dollar, Yen and Swiss Franc are trading as the strongest ones today as supported by solid safe haven flow. The free fall in Turkish Lira raised concerns of contagion to Eurozone financial system. Such worries sends the Euro broadly lower, even though Australian Dollar performs even worse. Crisis speech...
Erdogan is to Blame For Turkish Lira’s Free Fall
While US sanctions against Turkey have dominated news headlines, recent selloff of Turkish lira is a vote of dissent to the policy of the new government. After his “re-election”, President Tayyip Erdogan has grabbed tighter control of the economic and monetary policies. However, the policies implemented have failed to...
Euro Takes Center Stage With EUR/USD Breaking 1.5 Critical Support, Dollar and Yen Rally
The focus in the forex market shifts just before weekly close. Selloff in Euro has clearly intensified, in particular with EUR/USD finally breaking through 1.5 support level. The development also drags down Australian Dollar as both are now trading as the weakest ones. That could partly be attributed to...
Sterling Recovers, Dollar Mixed in Listless Trading
The forex markets are relatively directionless today, except overwhelming weakness in New Zealand Dollar. Sterling recovers broadly today on rumor that the EU is considering to offer a major Brexit concession to the UK. But there is so far no detail on the deal. Oversold condition also helps the...
New Zealand Dollar Dives after Dovish RBNZ, Sterling Stays Weak
New Zealand Dollar is clearly the biggest loser today after more dovish than expected RBNZ rate decision. Sterling is following as the second weakest, continues to be weighed down by no-deal Brexit worries. On the other hand, Canadian Dollar is staging a strong rebound as markets look pass the...
US Crude Oil Inventory Fell Less Than Expected, Fuel Stockpiles Climbed Higher
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products stocks increased +3.28 mmb to 1209.86 mmb in the week ended August 4. Crude oil inventory dropped -1.35 mmb (consensus: -3.33 mmb) to 407.39 mmb. Inventories decreased in 3 out of 5...
RBNZ Delays Timing for Rate Change and Inflation to Reach +2%, Kiwi Slumps
RBNZ’s August statement comes in more dovish than we had anticipated. While leaving the OCR unchanged at 1.75%, the members pushed backward expectations for the next interest rate adjustment. Moreover, they pushed back the timing for inflation to reach the +2% target. New Zealand dollar slumped after the announcement....
Sterling Plunges as No-Deal Brexit Becoming More Likely, Yen Shows Broad Based Strength
Sterling plunges sharply today as markets are seeing increasing change of a no-deal Brexit. Adding that, GBP/USD's break of 1.2956 earlier this week and EUR/GBP's break of 0.8957 resistance yesterday also adds to broad based pressure on the Pound. Australian Dollar follows as the second weakest at this point....