Commodity currencies remaining weak

26 August, 2015

The fallout from Monday’s volatility continues to be felt in markets largely devoid of other fundamental drivers. Yesterday’s cut in both 1 year lending rates and required reserve ratio appears to have some stabilizing effect, although European equities were already recovering before this news. The move is the fifth cut in rates in the past nine months, so can be seen as following on from the trend of recent months, rather than as an attempt to prop up the tumbling equity market, which has managed to stabilise today. After the yuan devaluation earlier this month, China appear to be moving back from more direct intervention in markets.

For FX, it’s meant a reversal of many of the moves we saw earlier in the week, which largely favoured the traditional safe havens such as the Swiss franc and the yen. Commodity currencies through are struggling against the backdrop of continued weakness in global commodity prices. This leaves USDCAD at highs for the year and the AUDUSD very near lows for the year to date. It’s difficult to see commodity currencies recovering given the wider global environment currently being faced. For today, there are no major data releases on the calendar, with just US durable goods at 12:30 GMT.


Source link  
CB meetings dominate the week

With no impactful economic data releases on the calendar today, the markets are focusing on a plethora of Central Bank meetings scheduled...

No Surprises from BoC & ADP

In an unsurprising move, the Bank of Canada decided to hold its benchmark lending rate at 1%, after two small hikes earlier in 2017. The BoC stated...

Moderate Gains for USD

On Monday, the US Commerce Department released Factory Orders data for October, indicating that the continued strength in the Manufacturing...


OPEC Extends Output Cuts

On Thursday, OPEC (Organization of Petroleum Exporters) and non-OPEC producers led by Russia agreed to keep output cuts until the end of 2018...

US Economy Expands Faster Than Predicted

Data released on Wednesday showed that the US economy expanded at its quickest pace since 2014 in Q3. The US Commerce Department said that...

Political Turmoil in Germany Hurts EUR

The EUR lost ground against many of its peers on Monday on news that Chancellor Angel Merkel’s efforts to form a coalition government had collapsed...


USD Suffers on Subpoena News

The Trump Administration is back in the spotlight with news of a report that Special counsel Robert Mueller’s investigators have issued a subpoena...

Positive data negated by tax plan opposition

The US Labor Department released data on Wednesday showing the consumer price index edged up by 0.1% in October after climbing by 0.5%...

Data Boosts EUR Can CPI Boost USD?

EUR received a boost on Tuesday, as data from Destatis showed German Preliminary GDP climbed to 0.8% in Q3, beating forecasts of 0.6%. In addition...

  


Share: