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Daily FX Market Commentary

Good Morning,

LMAX Close

USDJPY 109.761 | EURUSD 1.13222 | AUDUSD 0.70881 | NZDUSD 0.67442 | USDCAD 1.3279 | USDCHF 1.00015 | GBPUSD 1.29415 |

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.13285 | 1.13104

USDJPY                 110.018 | 109.742

GBPUSD               1.29446 | 1.29247

USDCHF               1.01006 | 0.99784

AUDUSD              0.71078 | 0.70807

USDCAD               1.32964 | 1.32672

NZDUSD               0.67732 | 0.67429

EURCHF                1.14228 | 1.13119

EURGBP               0.87585 | 0.87449

EURJPY                 124.528 | 124.282

For Today

  • GBP: A very limited range for the Cable with the market opening around the 1.2935 levels and trading deep into the session trading around the level deep into the Tokyo session, unable to move above the 1.2940 level the market eventually started a slow drift through to the grey hours pushing into the 1.2925 area and holding through to the grey hours, Downside bids now cleared to the 1.2850 areas and congestion likely to be in that area with maybe some weak stops on a dip through the 1.2830 areas however, stronger bids are likely to be around the 1.2800 level and for the moment everything still remains in the air with those bids likely to continue through to the 1.2760-70 areas before limited weakness appears through to the stronger 1.2700 area, topside offers light through the 1.2900 area and the market possibly open to a short squeeze on a move through the level with the market open to the 1.2950 before weak offers appear increasing as the market moves to the 1.3000 level and particularly strong around and through.
  • JPY: Euro’s opened a little stronger and the market moved slowly off the 109.75 areas to push quietly through early Asia holding around those level before starting a slow steady rise through to the 110.00 levels with a minor push through despite the Tokyo holiday today, topside offers above the 110.00 level with weak stop likely on a move through the 110.20 level and then further congestion quickly reappearing into the 110.40-60 areas and increasing into the 111.00 level and possibly stronger offers appearing, downside bids congested through the 109.40-00 areas with possible strong bids on any dip through the figure area and through to weak stops on a break through the 108.80-70 level.
  • AUD: Limited AUDJPY buying helped the market to move through to the 0.7110 areas in early trading before ranging tightly around the 71 cents area through to late in the session before dipping back towards the opening levels in a very limited range. Topside offers light back through the 71 cents level with congestion likely on a move above the 0.7150 areas and stronger offers likely to be building on a move through the 0.7160 areas and onwards, weak stops through the 0.7220 level could see a little squeeze through towards the 0.7280 areas where stronger offers start to appear. Downside bids cleared through to the 0.7060-40 congested area with possible strong bids around before the market opens for  move to the 70 cents level and a potential for a deeper move if that level were to break.
  • EUR: Opening around the 1.3220 areas the market dipped on the opening to test the 1.1315 level before slowly climbing through to the 1.1328 areas for the highs of the day before slowly sliding back to the opening levels. Downside congestion still remains through the 1.1320 and likely to continue through to the 1.1300 areas and stronger bids appearing on a move through the level a break through the 1.1275 areas could see weak stops appearing and the market making a quick stab lower before finding stronger bids into the 1.1220-00 areas, topside offers weak through the 1.1400 area and the market limited in stops with congestion likely to continue through to the 1.1450 areas, stronger offers on a push to the 1.1480-1.1500 levels with weak stops likely above the 1.1520 level.

 

Overnight News

CNY:

China New Year binge spending rises at slowest pace in years – BBG

AUD:

Home loan hit: ASIC will seek to change laws if it loses key case – MEA

 

Today’s Data

Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC

07:30     CHF        CPI M/M Jan C -0.30% | P -0.30%

07:30     CHF        CPI Y/Y Jan C 0.60% | P 0.70%

09:30     GBP       GDP M/M Dec C 0.00% | P 0.20%

09:30     GBP       GDP Q/Q Q4 (P) C 0.30% | P 0.60%

09:30     GBP       GDP Y/Y Q4 (P) C 1.40% | P 1.50%

09:30     GBP       Total Business Investment Q/Q Q4 (P) C -1.00% | P -1.10%

09:30     GBP       Index of Services 3M/3M Dec C 0.40% | P 0.30%

09:30     GBP       Visible Trade Balance (GBP) Dec C -12.0B | P -12.0B

09:30     GBP       Industrial Production M/M Dec C 0.10% | P -0.40%

09:30     GBP       Industrial Production Y/Y Dec C -0.50% | P -1.50%

09:30     GBP       Manufacturing Production M/M Dec C 0.20% | P -0.30%

09:30     GBP       Manufacturing Production Y/Y Dec C -1.10% | P -1.10%

09:30     GBP       Construction Output M/M Dec C 0.10% | P 0.60%

 

Weekend News

 

RUB:

Russia raised to investment grade by Moody’s

EUR:

German Minister signals support for National Champion Bank – BBG

Italy’s populist allies clash in test of strength at ballot box

CNY:

China’s bullish start to the year faces a big test after Holiday – BBG

China has no use for democracy, it needs a strong leader Xi Jinping right now – SCMP

China’s demographic danger grows as births fall far below forecast

USD:

Fed’s Daly: Financial conditions remain tighter than start of 2018

Daly: Higher uncertainty could crimp investment, hurt economy

Daly: Fed trying to decide on balance sheet endpoint, reserve buffer

Daly: Tapering balance sheet runoff is key part of Fed debate

Daly: Patience isn’t time dependent, its data dependent

EUR/USD:

German carmakers face huge hit if 25% tariff imposed – Forbes

US considering 3 car tariff options including 10% levy – WIWO

CAD:

Loonie rises against USD after record private job increase – BBG

NZD:

Westpac now sees no change in RBNZ rate until 2022 – BFW

NZ Shadow board sees reduced need for higher RBNZ – BFW

GBP:

PM May agrees to hold fresh talks with Jeremy Corbyn over his plans for a soft Brexit

 

Harry Hindsight

  • GBP: A reasonably quiet session for the Cable opening around the 1.2955 areas and ranging around the 1.2950 through the Asian session, moving into the grey hours saw the Cable slip lower through into early London testing to the 1.2920 areas before catching buyers and rallying quickly higher through to the 1.2970 level and easing into the NYK session pushing into the mid 70’s before slowly drifting back through the session to test through the 1.2930 areas again with only a limited move higher for the close.
  • JPY: A quiet move through early into the Tokyo session with Tokyo fix forcing the market through to the lows around the 109.65 before slowly rising back to the opening level around the 109.80 level and settling into a quiet range through to the 109.75 areas, the move through the grey hours and into the London session saw the market pushing through to the days highs and testing lightly to the 109.90 areas and the range for the day was set, the market drifted through to the lows into the late London but recovered to finish just short of the opening levels for the close.
  • AUD: A dovish RBA commentary saw the market dropping back from the opening around the 71 cents levels to set the lows around the 0.7060 areas and then holding for several hours in the area before starting a slow steady rise through the day and finally pushing the opening levels in early NYK, the market then ranged in the 0.7090 areas through to the close in quiet trading.
  • EUR: A very quiet session for the Euro, the market opened around the 1.1340 levels and then held around the level through into the London session before dropping off for the first time into the 1.1320’s the limited damage to the Euro from the French and Italian production numbers saw the market slowly moving off the lows to slowly push through into the NYK session testing through to the 1.1350 level and the highs for the day, NYK option cut saw the market slipping through to make the lows a little deeper into the 1.1320 areas and the market then held quietly through to the close and a quiet day over with.

 

Yesterday’s Premiership results

JPY         Household Spending Y/Y Dec A 0.10% | C 0.80% | P -0.60%

JPY         Current Account (JPY) Dec (P) A 1.56T |C 1.52T | P 1.44T

JPY         Labour Cash Earnings Y/Y Dec A 1.80% | C 1.80% | P 2.00% | R 1.70%

AUD       RBA Statement on Monetary Policy

CHF        Unemployment Rate Jan A 2.4% | C 2.40% | P 2.40%

EUR        German Trade Balance Dec A 13.9B | C 18.1B | P 19.0B | R 20.4B

CAD       Housing Starts Jan A 208K | C 206K | P 213K

CAD       Net Change in Employment Jan A 66.8K | P 9.3K

CAD       Unemployment Rate Jan A 5.8% | P 5.60%

 

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