The final countdown

14 December, 2015

This is the last full trading week of the year and in many ways, the most anticipated, given that the US FOMC is widely expected to increase interest rates for the first time since June 2006. It’s not a done deal, with markets pricing in around a 75% probability of a move. There are no major hurdles on the data front likely to impact that between now and Wednesday evening and the focus will fall more onto the message from the accompanying statement. That could have more influence on the way FX markets settle at the end of the week rather than the decision itself. Over the weekend, we saw some better data readings from China, with retail sales rising 11.2% YoY up to November and industrial production firmer than expected at 6.2%, from 5.6% in the previous month. Perhaps it’s not a coincidence that we’ve seen a reversal of the run of weaker yuan we’ve seen over the past few sessions, although the fixing was higher on USDCNY once again. For volatility though, nothing can beat the South African Rand over the past few sessions, with the appointment of another finance minister over the weekend, after he fired the incumbent on Wednesday, with his replacement lasting a mere 4 days. The rand is up more than 5% in early trading against the US dollar, but has to appreciate another 3.5% before regaining the levels that were prevailing ahead of this affair.

For today, we’re likely to see a relatively calm start to the week, with no key data releases scheduled. Stocks markets are starting the week on a firmer footing after the losses seen at the end of last week, whilst oil prices are still very near to multi-year lows. This is further impacting the oil exporting nations, the Canadian dollar and Norwegian Krone having both been under pressure of late. The Canadian dollar has stabilised a little, but continues to trade at more than 11 year highs on USDCAD.


Source link  
Markets pressured by Huawei problem

Alphabet and some other American IT companies have suspended business with Huawei, which is one of the first examples of major consequences for...

The climate is changing rapidly

British people need to fly less, drive electric cars, eat little meat and turn their home thermostats down to 19 degrees Celsius (66 Fahrenheit) in order to rein...

Chinese stocks saw their worst week

Chinese stocks have taken investors on a ride this year. Shanghai and Shenzhen have been the best performing global markets this year, with the Shanghai...


Risk-sensitive currencies on the rise

Stock markets show growth after the release of strong data for China and Japan as their respective PMIs were better than expected which supported...

Trump again puts pressure on OPEC

President Donald Trump told OPEC on Thursday that its members should start pumping more oil, marking his second warning to the producer group this year...

Turkish lira fell by 5% before elections

The Turkish lira dropped by as much as 5 percent against the dollar on Thursday morning, as the country gears up for elections this weekend. The greenback...


May won't ask for a long Brexit delay

Prime Minister Theresa May won't ask the European Union for a 'long' delay to the Brexit deadline, her office said, after pro-Brexit ministers objected...

Demand for safe assets grows

Markets remain under moderate pressure, despite the Fed comments. Powell's semi-annual speech in Congress reinforced expectations that the US Central Bank...

US-China trade talks: deadline postponed

China's blue-chip index jumped more than 6% on Monday morning on news that Trump would postpone of the tariff's introduction. The U.S. President...

  


Share it on:   or