Tag Archive: Australia

Yen Jumps on Rate Hike Speculation

2024-11-27

by

2024-11-27

Overview: The US dollar has a softer profile today. All the G10 currencies are higher, led by 1%+ surge in the yen amid heightened speculation of a rate hike next month, while the US 10-year yield is near 4.25% today, the lowest since the election. Although the Reserve Bank of New Zealand allows for another half-point cut after delivering the second one this year earlier today, the New Zealand dollar has popped up amid sell the rumor buy the fact...

Read More »

The Dollar’s Surge Continues

2024-11-14

by

2024-11-14

Overview: The dollar's surge continues. Most G10 currencies are off 0.45%-0.65%. The US dollar is trading above CAD1.40 for the first time since the pandemic, but the Canadian dollar is faring the best of the G10 today (~-0.15%). Since US election, it is the only major currency not to have fallen by at least 2%. All the emerging market currencies are lower today, as well. The greenback is being underpinned by the continued rise in US rates and...

Read More »

US Job Report may Offer Little Relief ahead of Next Week’s US Election and Meetings by Half of the G10 Central Banks

2024-11-01

by

2024-11-01

Overview: The first of what promises to be two tumultuous weeks is winding down. The US jobs data is the last big event. It is widely recognized that it will be skewed to the downside because of hurricanes and some mostly temporary factors. Anticipating the market’s reaction is also complicated by the weekend, and reports that Iran may strike back at Israel (through bases in Iraq?), and next Tuesday's US election, and five G10 central bank meetings...

Read More »

Ueda Lifts Yen, Stocks Slump, Gilts Under Pressure Post-Budget

2024-10-31

by

2024-10-31

Overview: The main move in the foreign exchange market today is the recovery of the yen following what was seen as hawkish comments by BOJ Governor Ueda. Otherwise, the tone is one of consolidation. The equity market sell-off today may be weighing on the Scandis and dollar-bloc currencies amid risk-off impulses. Emerging market currencies are mixed. The Mexican peso, which fell to a new low for the year yesterday, is stabilizing today and is among...

Read More »

Eurozone Growth Surprises, Lifts Euro, while UK Budget is Awaited

2024-10-30

by

2024-10-30

Overview:  The US 10-year yield is off around a dozen basis points off yesterday's high and European growth in Q3 was better than expected. This appears to have encouraged some dollar liquidation today. The greenback is softer against the G10 currencies, but the Canadian dollar and sterling. The much-awaited UK Autumn budget will be announced shortly. Sterling is consolidating around $1.30. Most emerging market currencies also are enjoying a firmer...

Read More »

Continued Backing Up of US Rates Extend the Greenback’s Gains

2024-10-23

by

2024-10-23

Overview: The persistent rise in US rates continues to help fuel dollar gains. The euro has been sold through $1.08 and the greenback has jumped over 1% against the yen to JPY152.75. It finished last week closer to JPY149.55. So far, Japanese officials have been fairly quiet, but this seems likely to change. The US two-year premium over Germany has widened by around 65 bp since late September to return to levels that prevailed in June. The...

Read More »

Today’s Employment Report is Important, but Fed Sees Another Before the Next FOMC Meeting

2024-10-04

by

2024-10-04

Overview:  The stronger than expected ISM services, which the market has seemed particularly sensitive this year lifted the two-year yield to about 3.71%, its highest level since the last employment report. The 10-year yield, which had been toying with 3.80%, finally settled above it for the first time in a month. The Dollar Index extended its advance to four sessions, matching the longest in six months. The focus is on the US employment report....

Read More »

Bailey Weighs on Sterling

2024-10-03

by

2024-10-03

Overview: The dollar enjoys a firmer tone today. The escalating conflict in the Middle East is keeping the market on edge. And then there is tomorrow's US employment report. Among the G10 currencies, sterling has been the hardest hit. It is off around 1% after Bank of England Governor Bailey seemed to signal that after pausing last month, the central bank may turn more aggressive here in Q4. Nearly all the emerging market currencies are...

Read More »

Powell’s Lack of Urgency Helps the Dollar Correct Higher

2024-10-01

by

2024-10-01

Overview:   Japan will go to polls a little ahead of the US. And the US election still looks too close to call. Canada may be forced into snap elections if the Bloc Quebecois abandon's negotiating with the minority Liberal government as it has threatened to do at the end of the month. The UK's new Labour government is putting together its first budget to be delivered at the end of the month. Among the first tasks of the new French prime minister is...

Read More »

European Currencies Start Week Softer, while the Dollar Bloc is Firm

2024-09-23

by

2024-09-23

European currencies are trading with a softer bias to begin the new week. Soft preliminary PMIs appeared to be the main culprit but Australia's PMI disappointed ahead of tomorrow central bank meeting, and the Australian dollar's small gain leads the G10 currencies today.

Read More »

Stocks Higher, Dollar Lower: Post-Fed

2024-09-19

by

2024-09-19

Overview: The Federal Reserve's 50 bp rate cut has made for a volatile 15 hours or so in the foreign exchange market. As North American traders return to their posts, the greenback is heavy. They will find that only the yen and Russian ruble are softer. Norway delivered a hawkish hold, and the krone leads the G10 currencies with more than a 1% gain. Australia's employment data was sufficiently strong that the Reserve Bank of Australia will likely...

Read More »

Atlanta Fed GDP Tracker Says US Economy is Expanding at 3% Clip for 3rd Quarter in Past 4, and the Fed is Going to Do What?

2024-09-18

by

2024-09-18

The dollar remains offered ahead of the FOMC meeting outcome. That no official has pushed back against the press story that some suspect was planted by the Fed Chair (will a reporter specifically ask him about it today?) during a quiet period should not be taken as evidence one way or the other. And many understand that it is not unprecedented.

Read More »

Corrective Forces Weigh on G10 Currencies, with the Euro Threatening its Largest Loss in Two Months

2024-08-28

by

2024-08-28

Business travel prevents the commentary for the next two days.  It will return with the September monthly on August 31.  Overview: Corrective forces are helping lift the dollar against all the G10 currencies. The euro's 0.5% pullback is the largest in nearly two months. Sterling's 0.3% loss is the most in nearly three weeks. The dollar-bloc currencies are the most resilient and are off less than 0.2% today. Emerging market currencies are more...

Read More »

USD is Trading Mostly Firmer, but Yen and Swiss Franc Show Resilience

2024-08-26

by

2024-08-26

Overview: The US dollar is mostly firmer, though consolidating against most of the G10 currencies. The Japanese yen and Swiss franc are the strongest, while the Scandis and Antipodean currencies are the heaviest. Among emerging market currencies, a handful of Asian currencies, including the Chinese yuan are higher, but central European currencies, the South African rand, and the Mexican peso are softer.The news stream is light but the threat of the...

Read More »

Data Thursday but Markets Unimpressed

2024-08-15

by

2024-08-15

Overview: An eerie calm hangs over the foreign exchange market on this the anniversary of the end of the Bretton Woods agreement 53 years ago today. Narrow ranges are dominating. Strong Australian jobs data and a cautious Norwegian central bank have underpinned their respective currencies today. A firm Q2 UK GDP appears to have given sterling a boost. The euro and the Swiss franc are struggling, while the yen is recording its narrowest range in...

Read More »

Is the US CPI Anti-Climactic?

2024-08-14

by

2024-08-14

Overview: Today's US CPI is the focus but the bar to a Fed cut next month is low, and it could prove anti-climactic. The more moderate inflation reading creates more space for the central bank to respond to signs of a continued slowing of the US labor market and adopt less restrictive policy. The dollar is mixed as the North American session gets under way. The rate cut by the Reserve Bank of New Zealand, not a total surprise, but has seen fall 1%....

Read More »

Are Risk Appetites Recovering?

2024-08-13

by

2024-08-13

Overview: The Antipodeans and sterling lead the G10 currencies today. The New Zealand dollar is the strongest, though the central bank is likely to deliver its first rate cut tomorrow. The Australian dollar rose to a three-week near $0.6610. Sterling was lifted by a stronger than expected employment report (though wage growth slowed) ahead of tomorrow's CPI. The yen and Swiss franc nursing modest losses. Emerging market currencies are mostly...

Read More »

Subdued Market Compared to a Week Ago: Is the Dramatic Position Unwinding Over?

2024-08-12

by

2024-08-12

Overview: The capital markets have begun the week in subdued fashion. Japanese markets were closed for the Mountain Day celebration, and this week's key events, which include US and UK CPI, and the Reserve Bank of New Zealand meeting and potentially its first rate cut. The uncertainty about the market positioning and the extent of the carry-trade may also be dampening activity. The yen and Swiss franc are the weakest of the G10 currencies today,...

Read More »

Equity Meltdown Continues as Attention turns to the US Employment Report

2024-08-02

by

2024-08-02

Overview: Federal Reserve Chair Powell said that although confidence has risen that inflation is on course back to 2%, the Fed is not quite confident enough to cut rates. The market effectively eased for it. Since the FOMC meeting began on Tuesday, the two-year US yield tumbled from 4.40% to 4.10%. The US 10-year yield settled below 4% for the first time in six months. The risk-off spurred by the weaker than expected US manufacturing ISM helped...

Read More »

Euro Trades Quietly Ahead of ECB Meeting

2024-07-18

by

2024-07-18

Jury duty assignment prevents a more comprehensive note, but here is a snapshot. Overview: The US dollar enjoys a firmer bias today, in mostly quiet turnover in narrow ranges. The Australian dollar is a noted exception, and the better than expected jobs growth may have lent it some resilience today. The greenback initially was sold to almost JPY155.35, a new low (since June 7) before recovering to nearly JPY156.60 in Europe. The UK's employment...

Read More »