Currency Focus
USD - These last couples of days we have seen the USD slide and now
it seems like the dollar focus is fading and market participants
instead turn toward carry trades once again. Currencies like the AUD
and the NZD have among other things been supported by these carry
trades whereas the JPY and CHF have been put a bit under pressure.
EUR - Given the positive growth figures and higher inflation, the ECB has all the arguments it needs to justify the 25 bp rate hike
expected next week.
GBP - As soon as nationwide House Price data came in GBP/UDs pair hits 14 year high at 1.9565. A little of the wind has been taken out of sterling's sails by the unexpected deterioration in November's GfK UK consumer confidence gauge, and November's CBI retail sales balance plunge to an eight-month low.
JPY - Bank of Japan Governor Fukui said today that policy makers need to ensure economic growth and prices are stable. The yen is likely to get out of the current range and have a big rally once the market can see when the Bank of Japan will raise rates.
AUD - The AUD was supported by strength in both retail sales and
private sector data, which suggest that recent rate hikes have not
done that much damage just yet. Capital spending data for Q3 was weak however, but at -6.0% q/q there is a sense that the data could be distorted. There is a risk of some further upside testing for the AUD in the short-term, but this will also depend upon further generalised USD weakness, such is the market focus on the ‘USD story’ at the present time. 0.80 is major resistance which should hold for now.
it seems like the dollar focus is fading and market participants
instead turn toward carry trades once again. Currencies like the AUD
and the NZD have among other things been supported by these carry
trades whereas the JPY and CHF have been put a bit under pressure.
EUR - Given the positive growth figures and higher inflation, the ECB has all the arguments it needs to justify the 25 bp rate hike
expected next week.
GBP - As soon as nationwide House Price data came in GBP/UDs pair hits 14 year high at 1.9565. A little of the wind has been taken out of sterling's sails by the unexpected deterioration in November's GfK UK consumer confidence gauge, and November's CBI retail sales balance plunge to an eight-month low.
JPY - Bank of Japan Governor Fukui said today that policy makers need to ensure economic growth and prices are stable. The yen is likely to get out of the current range and have a big rally once the market can see when the Bank of Japan will raise rates.
AUD - The AUD was supported by strength in both retail sales and
private sector data, which suggest that recent rate hikes have not
done that much damage just yet. Capital spending data for Q3 was weak however, but at -6.0% q/q there is a sense that the data could be distorted. There is a risk of some further upside testing for the AUD in the short-term, but this will also depend upon further generalised USD weakness, such is the market focus on the ‘USD story’ at the present time. 0.80 is major resistance which should hold for now.
posted by Naveen Pantera at 8:56 PM
<< Home