Sliding into year end

18 December, 2015

Currently markets feel like a newly married couple, trying to find their way in a newly anointed relationship. That new world is one of higher interest rates in the US, as much anticipated and expected the move was. The situation is probably not helped by declining liquidity into the festive period, which is going to be a factor for markets from today but especially from Monday until the end of the month. For equities, the honeymoon period may already be over, with the S&P500 down 1.5% by the close of yesterday’s session. The softer tone is also being carried over into the European session today, with indices on average 0.5% softer. Overnight, the mid-point on USDCNY nudged higher once again, for the chart looking like a steep mountain slope and this being the tenth consecutive move higher. We’ve also seen some adjustments from the BoJ after their latest policy meeting, which amounts to technical changes to their quantitative easing program, rather than an expansion of it. Still, the initial confusion saw the yen weaken briefly to the 123.00 level on USDJPY before the subsequent recovery below 122.00.

The single currency is finding itself under some selling pressure at the start of European trading, back towards support at the 1.08 level. The data calendar is relatively light, so markets are likely to be on the choppy side as liquidity thins and institutions square up books ahead of year end. The main exception is Canadian CPI data in calendar, where both the headline and core rates are seen rising. The Canadian dollar itself has been weakening consistently for most of the month to date, with USDCAD turning just shy of the 1.40 level. The currency looks vulnerable to a short squeeze should the data come out firmer than expected.


Source link  
The precious metal has broken out

The precious metal has broken out from its descending wedge around 1331.00 and moved higher to create a lower high at 1361.80.The price then...

All Focus on US inflation data

The USD has weakened further overnight as the market awaits important US Data at 13:30 GMT. USDJPY broke down under 107.000, while...

Central Bank speakers start a quiet week

UK MPC Member Vlieghe spoke at the Resolution Foundation in London. Some of the comments made were: If there is less credit headwind to the UK economy...


Equities Face a Nervous Session

The global equity markets are bracing themselves for a stormy closing session this week, as data from Thomson Reuters Lipper unit shows US fund...

Super Thursday for the Bank of England

The Bank of England is expected to largely proceed as normal today on ‘Super Thursday’ when the central bank releases its policy decision and statement...

US Nonfarm Payrolls Today

Today is Non-farm Payrolls day in the US. This data release is generally one of the most important of the month, being a leading indicator of consumer...


Australian Dollar drops after soft data

The Australian dollar eased on Thursday following weaker-than-expected economic data. The Australian Dollar took an initial knock on Wednesday on...

Trump Supports a Strong Dollar

Markets have had a volatile session this week thanks to various US officials and yesterday was no exception, with President Trump speaking in Davos...

A Weaker Dollar is Good for the US

Yesterday, Senior US Officials took the lead from their President and made clear the US position on Trade. Commerce Secretary Wilbur Ross...

  


Share: