Daily FX Market Commentary

Andy Harrison

Good morning,

NYK Close

USDJPY 78.862 | EURUSD 1.26312 | EURJPY 99.616 | AUDUSD 1.0282 | NZDUSD 0.8023 | USDCAD 0.98273 | EURCHF 1.20453 | USDCHF 0.95362 | GBPUSD 1.59327 | EURGBP 0.79277 |

 

Harry Hindsight

·         EUR: The pair finished higher over the course of the day, trading gradually higher through Asia moving steadily up above 1.2620, indifferent numbers from Germany and Eurozone, surprise that the interest rate wasn’t lower seemed to do nothing but when the ECB started to talk the initial reaction was to sell the EUR against everything and it moved down to just above 1.2560, as the so called OMT (Outright Monetary Transactions) will be the tool to replace the SMP, as usual details are a bit thin on the ground but the market liked it and it moved back up and topped out above 1.2640.

·         GBP: Cable was dragged around with the Euro having traded in a tight range in Asia and throughout the London session before moving up above 1.5925 then diving with the Euro to make the low below 1.5883 and rallying back up again this time hitting above 1.5940 and holding into the close.

·         JPY: A two fold story the first being decent employment figures before NFP later and the risk on as the ECB announcement set the tone USDJPY having been in a very tight range throughout Asia and most of London set of higher into the NYK session topping out above 79.00 before drifting slightly lower into the NYK close.

·         AUD: Better employment numbers initially sparked the buying taking it higher from the opening area of 1.0190 once the rally to the 1.0220 level was over we traded sideways awaiting the ECB conference and the Oz tagged along with the Euro rally with less of a downside moving to just below the 1.0300 to set the high for the day, we settled back slightly into the close.

Yesterday’s premiership results

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

AUD       Employment Change Aug A -8.8K | C 5.0K | P 14.0K | R 11.7K

AUD       Unemployment Rate Aug A 5.10% | C 5.30% | P 5.20%   

EUR        Eurozone GDP Q/Q Q2 (P) A -0.20% | C -0.20% | P -0.20%            

EUR        German Factory Orders M/M Jul A 0.50% | C 0.30% | P -1.70% | R -1.60%

GBP       BoE Rate Decision A 0.50% | C 0.50% | P 0.50%  

GBP       BoE Asset Purchase Target A 375B | C 375B | P 375B       

USD       Challenger Job Cuts Y/Y Aug A -36.90% | P -44.50%          

EUR        ECB Rate Decision A 0.75% | C 0.50% | P 0.75%  

USD       ADP Employment Change Aug A 201K | C 140K | P 173K

USD       Initial Jobless Claims A 365K | C 370K | P 374K | R 377K

USD       ISM Non-Manufacturing Composite Aug A 53.7 | C 52.5 | P 52.6

USD       Natural Gas Storage A 28B | C 40B | P 66B            

USD       Crude Oil Inventories A -7.4M | C -4.9M | P 3.8M             

For today

USDJPY:
Topside: 79.00-79.30 decent offers 79.30-79.65 light mixed bag
Downside: 78.45-78.80 small sell stops 78.00-78.30 good scaled bids EURUSD:
Topside: 1.2650-1.2670 small buy stops 1.2680-1.2720 good scaled offers 1.2720-1.2750 light offers
Downside: 1.2530-1.2565 light sell stops 1.2500-1.2530 marginal bids

EURJPY:
Topside: 99.70-99.95 light offers 100.00-100.30 small buy stops
Downside: 99.00-99.40 decent bids AUDUSD:
Topside: 1.0330-1.0360 light buy stops 1.0360-1.0390 good offers
Downside: 1.0240-1.0275 marginal bids

1:30        AUD       Trade Balance (AUD) Jul A -556M | C -300M | P 9M        

5:00        JPY         Leading Index Jul (P) A 91.8 | C 91.6 | P 93.2       

JPY:

Japan FinMin: government could run out of money by end-Nov

Japan Govt Announces Y5 Tln Budget Spending Delay amid Cash Shortage

Fitch Ratings: Japan Further Fiscal Slippage Could Trigger Downgrade

Japan Hosono To Give Up Running In DPJ Presidential Race -Kyodo

JPY/CNY/KRW:

Gemba: Japan to Forgo Summits With China, S. Korea on APEC Side-line’s – Kyodo

CNY:

China approves 30 infrastructure projects paper

China Mulls New Policies to Stabilize Trade Growth – Report

AUD:

Australia Trade Deficit Widens to A$556 Million

NZD:

NZ PM Key: TPP Offers Greatest Promise for Growth in Trade

USD:

Obama unites hope with realism in pitch for re-election

 

·         EUR: Market talks of risk being on and it grinds to a halt as we stop and pause for the next important number that being NFP this time, we’ve traded sideways over the session with a high spike of 1.2643 and a low of 1.2627 and while volumes have not been as bad as yesterday direction wise it’s a nothing day.

·         GBP: While the range has not been any greater than the Euro we’ve had a little bit more of a choppy session moving up above 1.5936 and dropping down to 1.5923 before moving back above the 1.2935 level for a dull day.

·         JPY: The rally stalls, having moved levels of the 78 handle Asia failed to move it along and we stayed into a tight range, moving from the opening area of 78.86 we moved above 78.94 and really that’s as far as we’ve managed to push and stay stuck around the 78.90 level.

·         AUD: After a poor trade balance showing the market continued to push through the 1.0300 as a technical move to fill Mondays opening gap, add to which position squaring for the weekend moved the market from the 1.0280 area pushing up to 1.0320 even with the bad news.

Today’s data

Consensus = C  Previous = P Timings GMT

05:45     CHF        Unemployment Rate Aug C 2.90% | P 2.90%       

06:00     EUR        German Trade Balance (EUR) Jul  C 15.4B | P 16.2B            

07:00     CHF        Foreign Currency Reserves Aug P 406.5B              

08:30     GBP       Industrial Production M/M Jul C 1.50% | P -2.50%            

08:30     GBP       Industrial Production Y/Y Jul C -2.80% | P -4.30%               

08:30     GBP       Manufacturing Production M/M Jul C 1.70% | P -2.90% 

08:30     GBP       Manufacturing Production Y/Y Jul C -2.40% | P -4.30%    

08:30     GBP       PPI Input M/M Aug C 1.70% | P 1.30%   

08:30     GBP       PPI Input Y/Y Aug C 1.50% | P -2.40%     

08:30     GBP       PPI Output M/M Aug C 0.20% | P 0.00%               

08:30     GBP       PPI Output Y/Y Aug C 1.90% | P 1.70%   

08:30     GBP       PPI Output Core M/M Aug C 0.00% | P 0.00%     

08:30     GBP       PPI Output Core Y/Y Aug C 1.20% | P 1.30%         

10:00     EUR        German Industrial Production M/M Jul C 0.00% | P -0.90%           

12:30     USD       Change in Non-farm Payrolls Aug C 127K | P 163K            

12:30     USD       Unemployment Rate Aug C 8.30% | P 8.30%       

12:30     CAD       Labour Productivity Q/Q Q2 P 0.10%       

12:30     CAD       Net Change in Employment Aug C 11.0K | P -30.4K          

12:30     CAD       Unemployment Rate Aug C 7.30% | P 7.30%       

12:30     CAD       Building Permits M/M Jul C -1.50% | P -2.50%    

14:00     CAD       Ivey PMI Aug C 64.5 | P 62.8       

14:00     GBP       NIESR GDP Estimate Aug P -0.20%           

Ranges as of 6am London time

                                Highs   Lows

USD/JPY               78.959 | 78.858

EUR/USD             1.2643 | 1.26268

EUR/JPY               99.77 | 99.6

AUD/USD            1.0321 | 1.0276

NZD/USD             0.8031 | 0.8002

USD/CAD             0.9835 | 0.9818

EUR/CHF              1.2054 | 1.2047

USD/CHF             0.95427 | 0.95343

GBP/USD             1.5937 | 1.5923

EUR/GBP             0.7932 | 0.79275

Stay lucky

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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