Dollar Shrugs Poor US Data, Euro Vulnerable to Another Selloff
Global stock markets are mildly firmer in consolidative mode today, with slight gains in major European sessions. Poor US economic data triggered little reactions. Dollar's rebound attempt is somewhat stuck below yesterday's high for now, while Canadian Dollar is recovering. For now, New Zealand Dollar is the weakest one...
Dollar Rebound Lacks Conviction Yet, Aussie Shrugs Job Data
Dollar stays broadly firm in Asian sessions after the recovery overnight. There were signs of bottoming in the greenback but the rally remains unconvincing with no follow through buying yet. Australian and New Zealand Dollars are currently the weaker ones. Better than expected job data is giving little support...
BOC Extends QE to Provincial and Corporate Bonds, while Leaving Rate at Lower Bound
After three cuts, 150 bps in total, in March, BOC left the policy rate unchanged at 0.25% at the April meeting. With the policy rate standing at the lower effective bound, the central bank added further monetary easing by extending the QE program. Unlike previous meetings, BOC did not...
Oil Price Slumped as Demand Expected to Fall the Most in 25 Years; US Inventory Continued to Soar
Oil prices slumped amidst concerns of oversupply. The market expects that the coordinated cuts announced last week, even if implemented smoothly, will fail to offset the severe contraction in demand. The latest report by International Energy Agency (IEA) suggested that global demand will fall to the lowest level in...
Dollar Rebounds Further on Oil Weakness and Poor US Data
Dollar is striking back today as market turns into risk averse mode, in particular after poor US economic data. Mild weakness in oil price is also weighing down on sentiments. For now, the greenback is the strongest one, followed by Yen and Swiss Franc. Australian Dollar is leading commodity...
Yen Leads Dollar Higher as Risk Rebound Lost Steam
Dollar and Yen recover mildly today as risk appetite somewhat lost steam again. Australian and New Zealand Dollar turn softer. The pattern of risk-on risk-off is rather common in corrective markets. There are signs of improvements regarding the coronavirus pandemic. But with over 2 millions accumulated infections and 126k...
BOC to Stand on Sideline this Week. Unscheduled Policy Announcement Possible in Near Future
Having cut the policy three times and announced QE program in March, BOC will likely keep the powder at the April meeting. Policymakers will explain the rationale of the stimulus measures, reinforcing that the policies are essential to containing the sharp slowdown in the first quarter. Recent economic data...
European Majors Rise on Partial Lockdown Exit, Dollar Decline Continues
Dollar's decline continues today on improving risk sentiments. In particular, it's back under pressure against Euro and Swiss Franc despite earlier recovery attempt. Canadian Dollar is not far away with drag from weakening oil price. On the other hand, European majors are generally stronger today, partly with help from...
Dollar Extends Decline as Coronavirus Figures Trend Down, Gold Shines
Dollar is staying under pressure as traders are back from holidays. Risk sentiment is relatively steady with new global coronavirus cases and deaths starting to trend down. The improvements are particularly evident in Spain and Italy since the start of April. There is also hope that the worst is...
OPEC+ Deal on Output Cut Unlikely Helps Reduce Surplus. Downside Risk on Oil Price Remains
OPEC+ eventually agreed on a final deal to reduce oil production by -10M bpd. Despite the significant headline figure, the effective cut is much lower. Actual output cut, late start and compliance issues suggest that the deal should not offer much help to the demand/supply balance in the oil...
CFTC Commitments of Traders – Bets on US Dollar Trimmed while Increased in Safe Haven Currencies
As suggested in the CFTC Commitments of Traders report in the week ended April 7, NET LENGTH in USD Index added +959 contracts to 15 014. Traders trimmed bets on both side as the market awaited more stimulus from the Fed. Speculative long positions dropped -134 contracts and short...
CFTC Commitments of Traders – Recovery on Oil Prices Fades on Failure to Agree on Coordinated Output Cut
According to the CFTC Commitments of Traders report for the week ended April 7, NET LENGTH for crude oil futures surged + 49 787 contracts to 484 895 for the week. Speculative long positions jumped +31 374 contracts while shorts declined -18 413 contracts. Crude oil price recovered from...
Moderation in China’s CPI Allows Government to Accelerate Stimulus
Inflation in China eased in March. Headline CPI slowed to +4.3% y/y in March, from a 8-year high of 5.2% in the prior month. The market had anticipated moderation to +4.8%. From a month ago, inflation contracted -4.6%, compared with a +9% gain in February.
Both food and non-food prices...
Dollar and Loonie Pressured after Poor Job Data
Canadian and US Dollars are both trading as the weakest ones today, after release of job data. US initial claims stood over 6m level for the second week while Canada lost more than 1m jobs in March. Meanwhile, Australian Dollar is trading as the strongest one, following higher stock...
Markets Steady Without Sustained Risk Buying, Aussie Remains Firm
Markets are steadily mixed in Asian session today. US stocks rose notably overnight but major indices actually closed below Tuesday's highs. No apparent follow through risk-on in seen in Asia too. Overall, Yen and Dollar remain the weakest ones for the week. Australian Dollar leads commodity currencies higher. Major...
FOMC Minutes Revealed Rationale for Emergency Cuts and QE Inifinity
As noted in the FOMC minutes for the March emergency meeting, the members agreed that economic situation has "deteriorated sharply" in light of the coronavirus pandemic. They were also in "strong support" of the measures to facilitate the flow of credit to households and businesses. Despite the consensus that...
US Crude Oil Inventory Made the Biggest Increase Since 2017
The report from the US Energy Information Administration (EIA) shows that total crude oil and petroleum products (ex. SPR) stocks surged +21.04 mmb to 1286.82 mmb in the week ended April 3. Crude oil inventory soared +15.18 mmb (consensus: +9.27 mmb) to 484.37 mmb. Stockpile rose in ALL PADDs....
Euro and European Stocks Soften as EU Fails to Agree on Coronavirus Rescue
Global markets lack a clear direction today. European stocks are generally lower for the moment after EU failed to agree on coronavirus rescue stimulus. But US futures point to higher open. In the currency markets, Sterling is the strongest one for now as Prime Minister Boris Johnson is said...
Dollar Recovers as Risk Rebound Lost Steam, Aussie Lower after Rating Outlook Downgrade
Dollar recovers mildly today as stock rebound somewhat lost momentum. In particular, DOW closed lower after gaining nearly 1000 pts overnight. Asian markets turned mixed despite rally in Nikkei. Investors could be awaiting the results of OPEC++ decision on production cuts before taking another move. Yen is following Dollar...
Dollar Selloff Extends as Stock Rebound Gathers Momentum
Global stock market rebound continues today on optimism the world is finally seeing the coronavirus curve flattening. As US futures point to another day of high open, current rebound is starting to look sustainable. In the currency markets, Australian Dollar continues to lead the way higher, followed by New...