Forex Today: Kiwi volatile on RBNZ & China prices, EU Eco Forecasts in focus
We had an eventful Asian session today, with risk sentiment elevated on firmer Wall Street close and higher Treasury yields. Hence, the DXY witnessed a spike in early Asia, only to head back towards 94.75 levels, almost unchanged on the day. The sentiment around the US dollar remained broadly undermined on the back of the US tax reform uncertainty, sending USD/JPY back below 114 handle. Meanwhile, the EUR/USD pair maintained its side trend near 1.16 handle.
The Antipodeans also witnessed two-way price action, with the Kiwi having reversed almost half the RBNZ-led rally. The OZ currencies managed to find some support from stronger Chinese PPI data, while the Chinese CPI release had limited impact on the markets.
Main topics in Asia
RBNZ: OCR forecast was tweaked slightly in a hawkish direction - Westpac
"The RBNZ's Monetary Policy Statement this morning kept the OCR on hold at 1.75%, as was widely expected.”
BOJ Summary of Opinions - Board discussed targeting long end of the yield curve
The Bank of Japan (BOJ) October meeting Summary of Opinions released today showed the nine-member board discussed targeting a longer end of the yield curve but concluded that the current stimulus is sufficient.
China's Oct CPI mixed, PPI surprises to the upside
China's Consumer Price Index (MoM) (October) came in at 0.1% vs 0.2% exp and 0.5% last, while Consumer Price Index (YoY) (October) was 1.9% vs 1.8% exp and 1.6% last.
US Senate Banking Committee to hear on Powell on Nov. 28
Reuters reporting headlines, citing that the US Senate Banking Committee will hold a hearing on Nov. 28th to confirm Jay Powell as the Fed Chair.
EU gives UK 2 to 3 weeks to make Brexit bill offer - FT
The Financial Times (FT) carries a story on Thursday, citing that the EU gives the UK two to three weeks to determine the amount to be paid in the Brexit divorce settlement.
US Pres Trump: ‘US trade deficit with China is shockingly high’
More comments hitting the wires from the US President Trump, as he speaks to Reuters, following his meeting with the Chinese President Xi.
Key Focus ahead
Heading into Europe, markets eagerly await the release of the German trade, ECB economic bulletin and EU economic forecasts for the much-need impetus on the Euro, in absence of significant first-tier macro data from the EUR docket.
Moving on the NA calendar also has limited economic releases on the cards, viz., Canada’s NHPI and the US jobless claims data. Focus also remains on the SNB Chairman Jordan’s speech scheduled later on Thursday. However, the main risk event for today remains the announcement of the US tax reform plan.
EUR/USD: Range-trade to remain intact ahead of US tax plan
The EUR/USD pair extends its 20-pips side trend into Asia, unable to find a clear direction amid a lack of fresh economic news from both continents and on increased cautiousness ahead of the US tax reforms plan…
Will GBP/USD defend 1.31 handle?
GBP/USD was the worst performing currency pair on Wednesday, courtesy of the political uncertainty in the UK. The pair hit an intraday low of 1.3086 before closing the day at 1.3112 levels.
GBP: Volatility to rise in coming weeks on UK political risk - ANZ
Analysts at ANZ over their outlook on the GBP/USD pair, especially after the BOE’s dovish rate hike and amid looming Brexit uncertainty.
Watching for developments tax reform and President Trump’s trip in Asia - UOB
Analysts at UOB noted that mrkets continue to watch for developments in the tax reform and President Trump’s trip to Asia.