Forex Today: USD sold-off on tax news, Antipodeans slip on poor China trade
Forex today was dominated by broad-based US dollar weakness, after the Washington Post (WaPo) reported that the Senate GOP is considering 1-year corporate tax cut delay. As a result, most majors made fresh upside attempts, with the Yen outperforming the fx board. The US President Trump’s stern warning to North Korea combined with weaker oil prices dampened investors’ moods for risk assets. Moreover, downbeat Chinese trade data also added to the risk-off sentiment and dragged the Antipodeans lower.
Main topics in Asia
USD/JPY drops on Washington Post: 'Senate GOP said to consider 1 Yr Corporate Tax cut delay'
USD/JPY has dropped back from the vicinity of the 114 handle and is making a fresh low for the European/NTY and early Asia.
BoJ’s Funo: Important to continue powerful monetary easing
Reuters reporting comments from the BoJ board member Yukitoshi Funo, as he speaks at a meeting with business leaders in Miyazaki.
US Pres Trump: “It makes sense for North Korea to come to the table”
The US President Donald Trump is reported by Reuters, as saying that North Korea's cruel dictatorship measures North Koreans by allegiance to the State in his scheduled speech to the South Korean assembly in Seoul.
China’s Oct trade data (Yuan terms): Downbeat across all indicators
China's trade balance for October, in Yuan terms, came in at CNY+254.47 bn vs +280.45 bn expected and +193.00 bn last.
China’s Oct trade data (USD): Trade surplus widens, but misses estimates
The China customs published trade balance for Oct in USD terms, reporting a slight miss on expectations in the Chinese exports, while the imports bettered estimates.
Key Focus ahead
We have a data-empty EUR calendar today, except for the ECB’s non-monetary policy meeting, which is virtually expected to have no impact on the fx markets. In the NA session, the Canadian housing starts and building permits data will keep the traders busy, while the EIA crude stockpiles data will be also closely eyed. Focus also remains on the RBNZ interest rates decision due to be announced towards NY close.
GBP/USD - Bear flag, yield diff. at key level, eyes Brexit transition terms
Despite the sharp recovery from the low of 1.3109 yesterday, the GBP/USD traded in the sideways manner around 1.3170 in Asia.
EUR/USD: Will the recovery gain momentum above 1.1600?
The EUR/USD pair failed to sustain the overnight recovery above 1.16 handle and drifted slightly lower, despite broad-based US dollar weakness, as the bulls await fresh impetus for the next push higher.
RBNZ preview: An uncertain terrain warrants caution
Thursday, the RBNZ will release its first Monetary Policy Statement under Acting Governor Grant Spencer.
RBNZ may well be noticeably more hawkish tomorrow - NAB
Analysts at the National Australia Bank (NAB) offer a brief preview of the Reserve Bank of New Zealand (RBNZ) October OCR decision that will be announced later on Wednesday.