6 December, 2016
The Reserve Bank of Australia decide to leave its policy settings unchanged. Such a decision was widely expected. The main, cash rate was left unchanged at 1.5% as expected by every analyst surveyed by Bloomberg. However the RBA mentioned that further easing cannot be excluded especially if stronger AUD threatens Australian recovery. The decision was already priced in so AUD remained pretty much unchanged but has finally moved lower due to a relatively dovish statement. AUD is currently the weakest among G10, trading -0.4% lower against the USD.
On the other hand, GBP is the strongest currency among G10, trading +0.24% higher against the USD. We had some comments both from Carney (BOE) and UK Chancellor Hammond. Carney spoke not only about some economic issues, but he also delivered important comments on a potential Trump and PM May policies. Hammond said that he wants a smooth exit from EU that minimises disruption, he also wants the best possible solution to both sides.
We also got some exceptional data from Germany. Factory orders from Germany surged, orders jumped 4.9% in October (consensus at 0.6%, prior reading at -0.3%, revised from -0.6%). It’s the biggest surge since July 2014. The production data for October will be published by the German Economy Ministry on Wednesday. Bloomberg consensus calls for 0.8% m/m rise. German economy has actually slowed down in the Q3 so such a report gives hope for a better Q4, Germany’s economy may be gathering pace after slightly weaker period.
Oil has slipped from 16-months high without any particular reason. OPEC prepares to meet producers from outside of the group on Saturday to widen cooperation.The stock rally has also lost steam as European stocks moved lower.
Baker Hughes report for the last week has showed another rise of US oil producers activity. The number of active rig counts rose by 8 w/w which obviously favours the further rebound of supply on the market...
European stocks are trading higher today due to a general risk-on triggered by Donald Trump. He commented on deregulation and corporate tax cuts and commited to introducing a plan in 2-3 weeks which was more than enough for US stocks to surge towards new record highs...
The sentiment on European equities is very cautious, but the main indices remain slightly above zero today. The Dax made an attempt in the morning to shake off its recent weakness, but upward move faded within one hour...
Bank remains short EURCHF targeting 1.02, Deutsche says that if speculators also upped the pressure, continued intervention would become ever costlier...
The DAX started the week with a fall of 100 points that was quickly corrected. Currently the index a bit higher on the day and the first drop should be associeted with the political news...
Stock markets have started out in a defensive mode this morning with the FTSE 100 falling more than 60 points. Donald Trump is in the headlines once more as his latest executive order signed late on Friday has caused a furore around the globe...
The overnight trading results in a continuation of the US dollar gains. A broad based recovery of the US currency is what has been missing yesterday morning to call the market behavior a proper return of the Trump trade...
This morning saw the release of data which shows that the UK economy grew faster than expected in the final quarter of 2016. The pound is higher on the day but has seen some weakness since the release, perhaps due to some traders seeing this as a good opportunity to book some profits after a strong run higher in the past couple of weeks...
After a closing bell on Wall Street, API issued a weekly report on Crude Oil inventories in the US. The report is pretty bearish for oil. Inventories rose by 2.93mln bbl with expectations at 2.5mln. If the data is confirmed it will be the 3 consecutive week of growth...
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