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Forex Flash: China overtakes US as world’s largest importer of oil – Deutsche Bank

In the world of fixed income, Fed Vice-chair Janet Yellen said yesterday that the Fed should continue on with its $85B/month bond purchases, recognizing that some risks need monitoring over time she doesn't see any that would cause her to advocate a curtailment of the purchase program at this stage. On this news, 10-year US Treasury yields rose 3bps higher to close at 1.87% yesterday.

Yellen's comments provided little support to commodities however with gold down 3.1% and Brent (-0.28%) down for its fifth consecutive day to $110/bbl yesterday. According to Macro Strategy Analysts J. Reid and C. Tan at Deutsche Bank, “China has overtaken the US as the world's largest net importer of oil.” According to provisional numbers from the EIA, US net oil imports dropped to 5.98M bbls a day in December (lowest since February 1992) while China's net imports rose to 6.12M bbls a day according to Chinese customs.

Forex: EUR/CHF upside capped at 1.2290

The Swiss franc is losing ground against its European counterpart on Tuesday, as risk appetite is swelling on positive data from the services PMI and EMU’s retail sales....
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Forex Flash: AUD still looks to break lower despite RBA – UBS

With external conditions still volatile, the RBA may have been forced to put some key domestic issues on the backburner just for now, such as enforced rebalancing away from the mining sector. According to Research Analyst Gareth Berry at UBS, “Long-term structural issues cannot be ignored and may move for a much weaker AUD further down the line, but in the short term there remains a lack of consistency in the drivers of price action.”
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