Daily FX Market Commentary

Andy Harrison

Good morning,

NYK Close

USDJPY 77.798 | EURUSD 1.28998 | EURJPY 100.361 | AUDUSD 1.03901 | NZDUSD 0.82343 | USDCAD 0.98058 | EURCHF 1.20954 | USDCHF 0.93753 | GBPUSD 1.61874 | EURGBP 0.79704 |

Harry Hindsight

·         EUR: Comments in one of the German daily papers about the Bundesbank checking the legality of bond purchases by the ECB scared the market in the Asian session moving from above the 1.2950 highs to trade down below 1.2900 several times during the London session, comments from FinMin Schaeuble then had the Euro spinning back above its Asian highs to above 1.2970 as he stated that defending the Euro was worth every effort however, the rally was short lived as USD took front stage with good results on the numbers released and Euro’s dropped back to the 1.2900 level into the close of the session.

·         GBP: Cable was static during the Asian session with gains for GBP against the Euro moving from mid- 0.7970’s down to below 0.7940 into the early London session, Cable rallied in early London with  the EURGBP selling, selling in NYK kicked in as USD rose with EURGBP gaining back the losses of the day as Cable played catch up with the Euro

·         JPY: USDJPY again pushed lower although in a tight range for the day moving from the opening above 77.80 down into the mid 77.60’s on the day it eventually finished the day only a few tics off yesterdays close but further into unwanted territory.

·         AUD: Oz moved lower over the day but in a much tighter range than we usually see, we opened just below the 1.0430 area and moved sideways for most of the day peaking above 1.0460 during early NYK before losing its lustre as the figures bit in from the US and it dropped after the IMM close running down through 1.0400 into the close.

Yesterday’s premiership results

Actual = A | Consensus = C | Previous = P | Revised = R 

JPY         Corporate Service Price Y/Y Aug A -0.30% | C -0.30% | P -0.20% | R -0.30%

CNY        Conference Board Leading Index Aug A 1.70% | C 0.70% | P 0.60%

EUR        German GfK Consumer Sentiment Oct A 5.9 | C 5.9 | P 5.9          

CHF        UBS Consumption Indicator Aug A 1.03 | C 1.55 | P 1.48

GBP       BBA Mortgage Approvals Aug A 30.5K | C 28.1K | P 28.4K | R 28.8K

CAD       Retail Sales M/M Jul A 0.70% | C 0.20% | P -0.40%            

CAD       Retail Sales Less Autos M/M Jul A 0.40% | C 0.20% | P -0.40%     

USD       S&P/Case-Shiller Composite-20 Y/Y Jul A 1.20% | C 1.10% | P 0.50%         

USD       Consumer Confidence Sep A 70.3 | C 63.2 | P 60.6           

USD       House Price Index M/M Jul A 0.20% | C 0.70% | P 0.70%           

For today

USDJPY:
Topside: 78.00-78.30 light offers
Downside: 77.50-77.80 decent scaled bids 77.20-77.50 medium sized bids 76.90-77.20 decent mixed EURUSD:
Topside: 1.2950-1.2990 light mix 1.3000-1.3030 light scaled buy stops
Downside: 1.2860-1.2895 light sell stops 1.2830-1.2860 small bids 1.2800-1.2830 medium sized sell stops

EURJPY:
Topside: 101.10-101.40 medium buy stops
Downside: 99.60-99.90 light sell stops AUDUSD:
Topside: 1.0410-1.0450 light offers 1.0460-1.0490 light buy stops
Downside: 1.0350-1.0380 light sell stops 1.0320-1.0350 light sell stops

JPY:

Kiuchi: BOJ Could Ease Policy Further via Purchase of Riskier Assets – Kyodo

Toyota plans to produce no cars in China in Oct paper

Suzuki: reducing China output in wake of anti-Japan protests

JPY/CNY:

Japan, China Foreign Ministers Meet in NY for First Talks Since Senkaku Dispute Erupted

AUD:

S&P Lowers South Australia To ‘AA’ From ‘AA+’; Outlook Stable

NZD:

New Zealand Trade Deficit Widened to NZ$789 Million in August

Fonterra’s Net Profit, Pay out to Farmers Hurt by Weaker Dairy Prices

TWD/CNY:

Taiwan CB: hopes for yuan in FX reserves in a year

 

22:45     NZD       Trade Balance (NZD) Aug A -789M | C -630M | P 15M | R 97M

·         EUR: A very quiet day opening around 12900 area and didn’t trade too far away topping just above 1.2912 until the final hour when a hedge fund came in selling hard possibly on an article in the Chicago tribune on the subject of the ESM, it would seem that 3 countries Germany, Netherlands and Finland issued a joint declaration yesterday which appeared to go contrary to what the said agreement in June said, basically saying the responsibility for indebted banks would remain with those countries governments, frustrating Spain and Ireland in particular from finding a way to break the link between themselves and said banks, result was a solid sell off taking the Euro down through the 1.2880 level that held so well into the 1.2860’s

·         GBP: Very slow on the Cable with the market opening around the 1.6190 area topping out about 1.6206 and holding in the area until the fall off in Euro, we went from the 1.6190 area to trade below 1.6160 briefly before rallying slightly EURGBP dropped about 10 tics to the 0.7956  before going quiet again into the 6am cut off.

·         JPY: USDJPY did nothing as was very quiet opening just below the 77.80 level we drifted down to just below 77.73 but held in that range for the whole session. EURJPY broke below the 100 level briefly but moved back above and remained in the area into the 6am cut off

·         AUD: The Oz had a slow drift lower with very little to excite moving from the 1.0390 area we moved down in two waves first stopping at 1.0355 and then moving another 10 tics in the second move with reasonable volumes, only the NZ trade balance number was a factor today although the number was worse than effected the revision for last month balances out so would explain why it wasn’t more of a move.

 

Today’s data

Consensus = C  Previous = P Timings GMT

10:00     GBP       CBI Reported Sales Sep C 5 | P -3             

12:00     EUR        German CPI M/M Sep (P) C 0.00% | P 0.40%       

12:00     EUR        German CPI Y/Y Sep (P) C 2.00% | P 2.10%           

14:00     USD       New Home Sales Aug C 380K | P 372K    

14:30     USD       Crude Oil Inventories C 1.7M | P 8.5M

Ranges as of 6am London time

                                Highs   Lows

USD/JPY             77.82 | 77.715

EUR/USD             1.2913 | 1.28645

EUR/JPY             100.46 | 99.98

AUD/USD             1.0385 | 1.0345

NZD/USD             0.8214 | 0.8187

USD/CAD             0.9818 | 0.9801

EUR/CHF             1.20987 | 1.209

USD/CHF             0.9397 | 0.9369

GBP/USD            1.6209 | 1.615

EUR/GBP            0.7970 | 0.79565

 Stay lucky

Andy

  Andy Harrison  

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