Choppy FX Awaits US New Home Sales & Beige Book
Dovish comments from BOE Bean; Spanish retail sales fell; solid Italian auction; Market focus is on new home sales, SNB Jordan and FOMC Tarullo speeches and FEDs Beige book. Will last nights new set of Premium Insights on GBPUSD prove to be on the money as were the prior 2 weeks? And why did we change the strategy in EURUSD? The latest edition also has 3 charts on EUR & Equity volatility. See more below in the bottom paragraph.
Optimism from the Greek deal disappeared while fiscal cliff worries continue to linger. The buck is stronger across the board except JPY. European equities are losing around 0.4%.
The BOE deputy governor Charles Bean who will, as we learnt yesterday, serve for one extra year said today that the UK economy will grow "weakly at best" and that a Q4 GDP decline is possible. He also added that the ongoing uncertainty limits QE effectiveness and that the BOE has not closed the door on further asset purchases.
The European data calendar was limited to Spanish retail sales that fell 9.7% y/y. German CPI for November will be announced right before the US session and analysts expect the inflation to ease to 2.0% from 2.1%.
Italy reached a full take up as it sold EUR 7.5 bln worth of 6 month bills. The average yield declined to the lowest level since 4/2010 at 0.919% from 1.347% and bid to cover improved to 1.65 from 1.52.
There are a number of risk events due during the US session today. New home sales at 10:00 am ET are expected to decline marginally in October to 387K from previous 389K. Crude oil inventories at 10:30 are seen higher at 0.5M barrels from last week's 1.5M barrels decline.
SNB chairman Thomas Jordan delivers a speech on monetary policy in Bern at 12:15 pm and the FOMC member Daniel Tarullo will begin his speech on regulation of foreign banking in New Haven at the same time.
At 2:00 pm the Federal Reserve will publish the Beige book. Analysts will seek comments on the impact of hurricane Sandy on industries along the east coast.
2 new trades on EURUSD, GBPUSD, 1 on USDJPY, 2 on EURJPY, 1 on AUDUSD, 1 on Gold and one existing, 2 new on silver and 2 existing in US crude oil. For DIRECT ACCESS to these trades and the relevant charts, click here: http://ashraflaidi.com/products/sub01/access/?a=696 NonSubscribers Can click here to join: http://ashraflaidi.com/products/
5 Near-Term Themes
by Adam Button | Jan 17, 2020 18:02
Ashraf in Dubai Jan 22-24
by Ashraf Laidi | Jan 17, 2020 14:20
Fear Crushed by Retail Sales & Round 1
by Adam Button | Jan 16, 2020 18:31
Sell the Fact or Sell the Economy?
by Adam Button | Jan 15, 2020 12:42
Markets Hesitant as US Makes Nice
by Adam Button | Jan 14, 2020 12:52