Tag Archive: Canada
Euro Bid in Europe but Unlikely to Sustain Gains Through North America
Overview: The dollar is beginning the new week mixed. The
dollar-bloc currencies and Japanese yen are softer while the European
currencies enjoy a firmer today. Among emerging market currencies, central
European currencies are trading with higher. The Turkish lira is the notable
exception. It is the weakest currency today, off about 0.65%. The Chinese yuan
is a little softer, but the dollar continues to be capped near CNY7.20. Last
week, more often...
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While the Greenback has Tended to be Sold in Asia this Week, it has Recovered in North America
Overview: Amid a light news stream,
the dollar is mostly in narrow ranges against the G10 currencies. Leaving aside
the Norwegian krone, the others in a +/- 0.15% against the dollar today. We
note that the technical tone of the euro and sterling have improved withe the
five-day moving averages crossing above the 20-day moving averages. On the
other hand, the dollar is approaching the year's low set last week near
JPY150.90. Emerging market...
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Risk On, Dollar Sold
Overview: The
post-close rally in US tech stocks after Nvidia's earnings has fueled risk-on
activity today. The Nikkei closed at record highs with a 2.2% rally. China's
CSI rose for the eighth consecutive session as official discourage sales at the
open and close, and short sales in general. Europe's Stoxx 600 is up more than
0.5% to recoup the small losses seen in the last two sessions. US indices are
poised to gap higher at the open. Benchmark...
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Dollar Slips but Dip may Offer New Opportunity
Overview: The US dollar is offered today. It is
trading softer against all the G10 currencies, with the yen the notable
exception, and it is flat. The Antipodean are leading the way, taking out last
week's highs, as has the euro. That said, the intraday momentum indicators are
stretched as NY dealers return from the long holiday weekend. The Scandis are
also trading above last week's highs. The yen, sterling, Canadian dollar, and
Swiss franc are...
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Becalmed FX Market doesn’t Conceal the Greenback’s Strength
Overview: The foreign exchange market is
becalmed today, with most of the major pairs trading in narrow ranges. The
economic calendar is light and the North American session features benchmark
revisions in US CPI and Canada's January employment figures. The US quarterly
refunding supply has been absorbed without much fanfare. The dollar-bloc
currencies and the Norwegian krone are firmer today. A bank forecast that the
central bank will hike rates...
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Sterling Moves Back into Previous Trading Range, but will it Hold?
Overview: The dollar is trading with a
slightly heavier bias as some of its recent gains are pared. Sterling has moved
back into the $1.26-$1.28 trading range that dominated since the middle of last
December until the start of this week. The euro is also trading a little firmer
despite another large drop in German industrial output (-1.6%). The Japanese
yen, Swiss franc, and Norwegian krone are the notable exceptions with a softer profile....
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Oil Retraces Initial Surge, Euro Slips to Marginal New Low, while Sterling Hugs $1.27
Overview: Key developments today include the Hong
Kong court ordered liquidation of China's Evergrande and the reversal of oil
prices after a sharp rally initially in Asia after separate attack in the
Middle East that killed US troops in Jordan and struck a Russian oil tank in
the Red Sea. March WTI, which settled near $78 ahead of the weekend, its best
level since the end of last November, rallied to about $79.30 before returning
to almost $77.50...
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Quiet End to a Busy Week
Overview: The dollar's surge in the first part of
the week has given way to consolidation. The US dollar is sporting a softer
profile against most of the G10 currencies. The Dollar Index is threatening to
snap a three advance. Sterling is a notable exception following the weakest
retail sales report since 2021. Most emerging market currencies, including
China, Taiwan, and Mexico are slightly firmer. US President Biden is expected
to sign a bill...
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Stronger-than-Expected UK CPI Helps Steady Sterling after Dollar Rally Extended
Overview: The sharp dollar advance is stabilizing after
follow-through gains earlier today. A larger than expected rise in the UK's
December CPI helped sterling recover from the push below $1.26, the lower end
of a one-month trading range. It is the only G10 currency that is firmer
against the dollar ahead of the North American session. ECB's Lagarde pushed
back against the early rate cut speculation and this may have stemmed the
euro's losses. The...
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The Dollar Goes Nowhere Quickly
Overview: The dollar continues to consolidate
broadly after the dramatic price swings at the end of last week. For the most
part, the greenback remains inside yesterday's ranges, which were inside last
Friday's. The G10 currencies are a little heavier today, except the Japanese
yen and Norwegian krone, which are posting small gains. Indeed, the greenback is near session highs against most of the major currencies as we go to print. Emerging market...
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Greenback is Bid ahead of the Jobs Report
Overview: The dollar is bid going into the December
jobs report. After selling off into the end of last year, it has recovered this
week. The five-day moving average is crossing the 20-day moving average against
several of the currency pairs, capturing the shift in momentum. The greenback's
gains have as interest rates have jumped. The 10-year Treasury yield finished
last year near 3.88% and is now near 4.04%. European benchmark rates have
mostly...
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Consolidative Tone Emerges Ahead of Tomorrow’s US Jobs and EMU CPI
Overview: After gaining for the past couple of
sessions to open the New Year, the dollar is mostly softer today. The yen is
the main exception. The greenback was bid above the JPY144 area where
chunky options expire today. Most emerging market currencies are also firmer
though there are a few exceptions in Asia, like the South Korean won and Thai
baht. Still, the general tone is consolidative ahead of tomorrow US jobs data
and the eurozone's CPI....
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Markets Catch Collective Breath
Overview: The US dollar is mixed today. The dollar-bloc currencies are firmer, while the euro and yen are softer. We had anticipated a recovery of the dollar on ideas that the market has too aggressively pushed down US rates, and pricing in more Fed easing with higher confidence than seems to be warranted by the recent data. However, US rates have not recovered, but the dollar has. Partly, this reflects that rates have fallen as faster if not...
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Softer Tokyo CPI Buys BOJ Time while Moody’s Cuts the Outlook for China’s Debt following Fiscal Stimulus and the Continued Property Slump
Overview: Outside of the Australian dollar, which
has fallen by around 0.6% following the RBA meeting and the softer final PMI,
which may have dragged the New Zealand dollar a lower by around 0.25%, the
other G10 currencies trading little changed ahead of the start of the North
American session. The eurozone and UK final PMIs were revised higher. Central
European currencies lead the emerging market currencies. China reported better
than expected...
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Rates and the Dollar Come Back Firmer
Overview: Weekend accounts seemed to try to
understand what Fed Chair Powell said by beginning with the large drop in US rates. Yet,
most accounts miss the fact that no matter what Powell has said, the market has more often than not reacted as if he were a dove. Rates have come back firmer today, perhaps as some
recognized the overshoot. The US two-year yield is up nearly seven basis points after
falling 14 before the weekend. The 10-year yield is...
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What Will Powell Say?
Overview: The dollar traded better into month-end but is softer
today. The Scandis and dollar-bloc currencies are leading with around 0.2%-0.5%
gains. In addition to US manufacturing PMI and ISM surveys, and construction
spending, auto sales will trickle in, but key for market participants today
will likely be Fed Chair Powell's comments and the extent that he pushes
against the dramatic rate cuts, with more than a 50% chance of the first cut by...
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The Dollar is Having One of Its Best Days This Month
Overview: After being bludgeoned, the dollar
is having one of its best days of the month. It is rising against all the major
currencies. The Dollar Index is up about 0.5%, which is the most since the end
of October. The greenback is also firmer against all the emerging market currencies
but the Turkish lira and Russian ruble. Some of the demand for the dollar may
be a function of month end, but also the disappointing Chinese PMI, revisions
that...
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Dollar Recovers After Losses Extended in Asia
Overview: On the back of lower interest rates, the greenback's
slide was extended in early Asia Pacific turnover, but it has recovered. As
North American trading begins, the dollar is firmer against all the G10
currencies but the New Zealand dollar, which has been aided by the hawkish hold
of the central bank, and an immaterial gain in the Swiss franc. Emerging market
currencies are mixed. Central European currencies and the Mexican peso are...
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Dollar Retreat Extended, but Turn Around Tuesday may have Already Begun
Overview: Last week's dollar losses have been
extended today. The yen is leading the move, encouraged by talk of a buying by
a large US real money fund. The Dollar Index is off about 0.35% after sliding
1.8% last week. It is below the 200-day moving average for the first time since
late August. As was the case last week, the Canadian dollar is the laggard. Emerging
market currencies are also mostly higher. The Chinese yuan's 0.67% rise is the
most...
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The Dollar’s Recovery has been Extended, but it may Give North American Operators a Better Selling Opportunity
Overview: The dollar's sell-off last week was
extreme and it recovered yesterday and through the European session today. The
Australian dollar has been hit the hardest. It is off more than 1% today after
the RBA lifted the cash rate by 25 bp (to 4.35%). Still, the US dollar's gains
have stretched intraday momentum indicators, suggesting the upside correction
may be nearly over. The greenback's moves appear to have been driven by
interest rate...
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