FX News Today
- Overnight, Asian markets fought to sustain a rebound amid hopes that the Fed may stop the rate hike cycle after the widely expected December move.
- USDJPY recouped to upper 112.0s. Yen performance reflects a broad unwinding of safe-haven positioning following a late-session rebound on Wall Street and steadying in stock markets across Asia after yesterday’s outsized losses.
- Nikkei gained 0.82%, even though Hang Seng and CSI 300 remain under pressure.
- Fed Chairman Powell stressed the strength of the labour market late.
- The Huawei arrest continues to hang over US-Sino relations, however, the sell-off in stock markets on Thursday started to ease during the US session.
- President Trump cited a Beijing statement on Twitter, that “‘We are full of confidence that an agreement can be reached within the next 90 days.’ I agree,” which helped to allay investor concerns of an entrenching trade war.
- OPEC+ producers continue to bicker over production cuts. Though the amount is yet to be determined, and will be discussed today, with the Russian energy minister expected to be in attendance.
- WTI crude are trading around to the $51.00 level following the EIA inventory data which showed a 7.3 mln bbl fall in crude stocks, against the 2.0 mln bbl decrease expected.
Charts of the Day
Main Macro Events Today
- European GDP – Expectations – The Q3 GDP growth, which is expected to be confirmed at 0.2% q/q, lower than initially expected and partly reflecting the -0.2% q/q contraction in Germany that quarter.
- Nonfarm Payrolls – Expectations – NFP are projected rising 200k after a solid 250k increase in October. Payrolls are averaging 213k so far this year, up from 182k in 2017 and 195k in 2016. The unemployment rate is expected to remain at the 49-year low of 3.7%. Attention will be on average hourly earnings, which should rise 0.2% on the month.
- Canadian Employment data – Expectations – November employment is expected to show a 15.0k gain after the 11.2k rise in October. The unemployment rate is expected to hold at 5.8%
- Prelim UoM Consumer Sentiment – Expectations – The Michigan sentiment index likely edged up to 97.8 in December after dipping to 97.5 in November. Overall, the index remains at a high level, though now further below the 14-year high of 101.4 in March.
Support and Resistance
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