Risk return temporary

13 January, 2016

Finally some risk appetite is returning to Asian markets which have bounced overnight and this is due to feed into today’s European session. Chinese trade data was better than expected with a surprise improvement in exports which has been assisted by a weaker yuan. The China story has dominated the markets so far this year and in one way it’s nice not to be talking about other things such as the Fed, but in others this topic is likely to remain a dominant force in 2016, more so than in the past as the world’s second largest economy continues to slow meaning this return of risk appetite we’ve seen so far this week may be temporary.

Economic data to focus on today comes in the form of Eurozone industrial production which is expected to decline. If we see a deterioration along the lines of yesterday’s industrial and manufacturing data from the UK then we could see a corresponding move to the downside in the single currency. EURUSD has pulled back from its attempts of breaking the 1.1000 level once again and looks vulnerable to further weakness, especially since today sees some Fed members speaking in the form of Rosengren and Evans, so it will be interesting to hear their thoughts on last week’s impressive nonfarm payroll. Then there’s the release of the Beige Book, so we could see some volatility in the dollar.


Source link  
Divergence Between Fed and BoJ

The March FOMC meeting will be held for two consecutive days from today. The interest rate decision will be announced at 18:00 GMT on Wednesday 15th March...

Market Volatility Expected Ahead of President Trump's Speech

In a speech that will be watched by millions of viewers in the United States and around the world, the President is expected to speak of his presidency and address pressing issues like his plans for health care, the tax system, the military, and his goals for his administration...

Gold Trades Below Resistance Ahead of the Fed and NFP

We will see the release of the US ISM Manufacturing PMI, and ISM Prices Paid for January, at 15:00 GMT on Wednesday 1st February...


Sterling Struggles Ahead of Theresa May's Speech

Theresa May will make a speech outlining her plans for Brexit tomorrow, Tuesday 17th Jan, before the UK triggers Article 50 to leave the EU...

Dollar Turn-around on Trump's Press Conference

President Elect Trump's first press conference after his victory in the US presidential election, was held yesterday around at 16:00 GMT. It has caused great volatility to the dollar and the markets...

Gold Nears Major Resistance Ahead of Trump’s Press Conference

Gold prices have rebounded since mid-Dec after testing the significant support line at 1120. On the 4 hourly chart, gold bullish momentum has been strengthened since the beginning of this year, helped by the dollar retracement...


Searching for a new narrative

Popcorn at the read today as President elect Trump has a scheduled news conference later in the day (around 16:00 GMT). Markets have become used to listening to him in 140 characters or less over the recent weeks, so a more elongated narrative should be welcome...

The sterling conundrum

Yesterday's early weakness in sterling, on the back of the latest comments from PM May surrounding Brexit, took cable close to key support levels and the resilience seen through most of the post US election period has been unwound...

Selling into USD strength

In summary, Friday US jobs report was pretty much in line with expectations, although the slightly better data on earnings gave some support to the dollar into the end of the week. As a result, the US currency was little changed from Tuesday opening levels...

  


Share: