Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close

USDJPY 106.915 | EURUSD 1.10262 | AUDUSD 0.68494 | NZDUSD 0.64273 | USDCAD 1.31676 | USDCHF 0.98746 | GBPUSD 1.2290 |

 

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.10294 | 1.10158

USDJPY                107.018 | 106.77

GBPUSD              1.22911 | 1.2267

USDCHF               0.98924 | 0.98785

AUDUSD             0.68583 | 0.68387

USDCAD              1.31783 | 1.31656

NZDUSD              0.64353 | 0.64213

EURCHF               1.09082 | 1.08795

EURGBP              0.89838 | 0.89712

EURJPY                117.936 | 117.742

 

For Today

  • GBP: Opening a little lower as the weekend saw only a slight respite from the Brexit tennis match going on in Parliament however, Johnson continued with his attempts and manoeuvrings’ dropping from the opening 1.2285 level the market tested the 1.2270 level quickly before slowly rising to the 1.2285 level ranging around the level to test to the high of the 1.2290 area before drifting off again towards the lows for the move into the grey hour. Topside congestion through the 1.2360 areas with increasing congestion on the approach to the 1.2400 level with stronger offers on a test through the level with limited stops with offers increasing from the 1.2450  area through to the 1.2500 level, light  bids through to the 1.2250 area with reforming congestion on any dips through the level and into the 1.2200 level, any push through the level will likely see weakness quickly appearing until closer to the 1.2100 level and the downside if there is strong selling suspect and open through to the recent lows.
  • JPY: Limited range but a little choppy through Tokyo with the market dropping quickly to the 106.80 area before rising through to the 107.00 areas in a slow move before dropping quickly back to the 106.90 level and then moving again to the 106.75 area bouncing back to the opening level before drifting through to the grey hour, Downside bids starting to light through the 106.00 level but some congestion through to the 105.80 areas before firming up around the 105.00 areas and increasing on any move to the 104.50 level with stops likely to not appear until through the 104.00 level and the likelihood of buyers willing to buy into any dips, Topside offers through to the 107.50 level before stronger congestion appears with limited potential to squeeze to the 108.00 level, a break through the level should see stops appearing and the market able to squeeze 108.40-60 areas before stronger offers appear.
  • AUD: Very quiet session for the Oz with the market holding around the opening 0.6845 area and with a minor test in the Tokyo session to just below the 0.6840 level the market then spent the bulk of the session pushing higher and through to the 0.6855 area for the move into the grey hour, downside bids likely to reforming around the 0.6700 areas and increasing through to the 0.6680 level, a break through the level is likely to see weak stops appearing and the market open to a larger move over the long run however, a dip into the 0.6620 area will again see strong bids appearing, Topside offers still remain in the area around the 0.6825 areas with a push through to the 0.6830  level with congestion then appearing through the 0.6840 level but becoming weaker until the stronger offers into the 0.6880 areas and through onto the 69 cents level.
  • EUR: A slow drift to the lows from the opening around the 1.1025 area to test through to the 1.1015 level into the Tokyo session before recovering a little quicker only to hold around the opening level through to the grey hour. downside bids into the 1.0920 level and likely to continue through to the 1.0880 level however, congestion is then likely to start increasing as the market moves into the mid ranges from 2015-16 with limited bids until 1.0800,Topside offers through the 1.1040-60 area with increasing congestion on a test to the 1.1100 areas, weak stops likely on a break of the 1.1120 level and the market then running to weaker congestion into the 1.1140-60 and increasing on any move to the 1.1180 level.

 

Overnight News

NZD:

BNZ lowers NZ GDP growth forecast on shaky manufacturing data – BBG

NZ manufacturing values, volumes fell in second quarter – BBG

CNY/USD:

Apple, Foxconn broke China labour law for Iphone production – BBG

Apple denies some allegations in China, Labour watch report – BBG

China labour watch alleges harsh conditions at Foxconn plant – BBG

Companies confirm CLW report on excessive use of temp workers – BBG

GBP:

Johnson draws up plan to legally stop Brexit extension if MPS vote against General election – Tel

Opposition MP’s to request emergency debate on Monday in Parliament to try to force government to publish no deal planning document – ITV

USD:

Powell says Fed will sustain expansion, reinforcing rate cut Bet – BBG

 

Today’s Data

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

CNY        Trade Balance (AUG) A $34.84b | C $42.80b | P $44.58b

CNY        Trade Balance CNY (AUG) A 239.60b | C 299.30b | P 310.26b

JPY         Trade Balance – BOP Basis (Yen) (JUL) A -¥74.5b | C -¥31.0b | P   ¥759.3b

JPY         Gross Domestic Product Annualized s.a. (QoQ) (2Q F) A 1.3% | C 1.3% | P 1.8%

JPY         Bank Lending Ex-Trusts (YoY) (AUG) A 2.2% | P 2.5% | R 2.4%

JPY         Bank Lending incl Trusts (YoY) (AUG) A 2.1% | P 2.3%

AUD       Home Loans (MoM) (JUL) A 4.2% | C 1.3% | P 0.4%

JPY         Eco Watchers Survey Current (AUG) A 42.8 | C 41.3 | P 41.2

05:45     CHF        Unemployment Rate (AUG) P 2.1%

05:45     CHF        Unemployment Rate s.a. (AUG) C 2.3% | P 2.3%

06:00     EUR        German Trade Balance (JUL) P 16.8b

08:00     GBP        BOE’s Vlieghe Speaks in London

08:30     GBP        Monthly GDP (3M/3M) (JUL) C -f0.1% | C -0.2%

08:30     GBP        Monthly GDP (MoM) (JUL) C 0.1% | P 0.0%

08:30     GBP        Industrial Production (YoY) (JUL) C -1.0% | P -0.6%

08:30     GBP        Manufacturing Production (YoY) (JUL) C -1.0% | P -1.4%

08:30     GBP       Construction Output (YoY) (JUL) P -0.2%

08:30     GBP        Visible Trade Balance (Pounds) (JUL) P -£7009m

08:30     GBP        Trade Balance Non EU GBP/Mn (JUL) C -£3000m | P -£186m

08:30     GBP        Trade Balance (JUL) C -£1000m | P £1779m

11:00     MXN      CPI (MoM) (AUG) C -0.02% | P 0.38%

11:00     MXN      CPI Core (MoM) (AUG) C 0.19% | P 0.26%

11:00     MXN      CPI (YoY) (AUG) C 3.16% | P 3.78%

11:00     MXN      Bi-Weekly CPI (AUG 31) C 0.05% | P -0.08%

11:00     MXN      Bi-Weekly CPI (YoY) (AUG 31) C 3.04% | P 3.29%

11:00     MXN      Bi-Weekly Core CPI (AUG 31) C 0.08% | P 0.11%

19:00     USD        Consumer Credit (JUL) C $16.300b | P $14.596b

 

Harry Hindsight

 

  • GBP: A slow Asian session with the early high testing the 1.2340 level before drifting through into the early Tokyo session to run along the 1.2325 areas before moving into the London session pushing through the 1.2340 level before dropping quickly back to the 1.2300 areas on the release of 12 month Inflation, the market continued to hold around the level through into NYK before slowly pushing through to the 1.2335 areas before drifting through the balance of the day testing to the 1.2280 level before moving into the close around the 1.2290 level.
  • JPY: A limited range through to the NYK session opening around the 107.00 level dipping to the 106.90 area and then steadily recovering through into the Tokyo session to test the 107.10 areas, and while it tested those levels several times through to the London session it was unable to push through, the move to the grey hour saw the market drifting back to the opening levels and into London repeating the range through to the NYK opening before dropping quickly on the release of the lacklustre US numbers testing quickly to the 106.70 level bouncing and then moving lower again testing through to the 106.60 areas to make the low for the day, bouncing off the level the market settled around the 106.80 areas for a few hours before rising to the opening levels for the run to the close.
  • AUD: A slow drift from the opening dipping a little through the 0.6810 area before starting a slow rise through to the 0.6820 areas, the move into the London session the market started a slow but steady rise through to just below the 0.6840 areas before moving into the NYK session to push higher and the market ground through the 0.6860 level before failing and drifting to a close around the 0.6850 area.
  • EUR: Limited movement in early Asian hours, drifting from the opening around the 1.1035 areas testing the 1.1030 level and starting a slow rise on the move towards the grey hour and holding above the 1.1040 area, London pushed the market through the 1.1050 areas before slowly drifting through to the NYK opening making the lows on the opening just above the 1.1020 level and reversing the move after the US numbers and pushing steadily through to make the highs through to the 1.1055 area, the market drifted from the highs and then dropping quickly back to the 1.1030 level for the move to the close.

 

Yesterday’s Premiership results

AUD       AiG Performance of Construction Index (AUG) A 44.6 | P 39.1

JPY         Overall Household Spending (YoY) (JUL) A 0.8% | C 0.8% | P 2.7%

JPY         Real Cash Earnings (YoY) (JUL) A -0.9% | C -0.7% | P -0.5%

JPY         Labour Cash Earnings (YoY) (JUL) A -0.3% | C 0.1% | P 0.4%

JPY         Leading Index CI (JUL P) A 93.6 | C 93.2 | P 93.3

JPY         Coincident Index (JUL P) A 99.8 | C 100.7 | P 100.4

EUR        German Industrial Production n.s.a. and w.d.a. (YoY) (JUL) A -4.2% | P -5.2%

GBP        BoE/TNS Inflation Next 12 Mths (AUG) A 3.3% | P 3.1%

EUR        Euro-Zone Government Expenditure (QoQ) (2Q) A 0.3% | C 0.3% | P 0.1%

EUR        Euro-Zone Gross Domestic Product s.a. (QoQ) (2Q F) A 0.2 | C 0.2% | P 0.2%

EUR        Euro-Zone Gross Domestic Product s.a. (YoY) (2Q F) A1.2% | C 1.1% | P 1.1% | R 1.3%

CAD       Full Time Employment Change (AUG) A 23.8 | C 17.5 | P -11.6

CAD       Net Change in Employment (AUG) A 81.1k | C 20.0k | P -24.2k

CAD       Hourly Wage Rate Permanent Employees (YoY) (AUG) A -3.8% | C 4.5% | P 4.5%

CAD       Unemployment Rate (AUG) A 5.7% | C 5.7% | P 5.7%

USD        Change in Non-farm Payrolls (AUG) A 130k | C 160k | P 164k | R 159k

USD        Change in Private Payrolls (AUG) A 96k | C 150k | P 148k | R 131k

USD        Unemployment Rate (AUG) A 3.7% | C 3.7% | P 3.7%

USD        Average Hourly Earnings (YoY) (AUG) A 3.2% | C 3.0% | P 3.2% | R 3.3%

USD        Average Weekly Hours All Employees (AUG) A 34.4 | C 34.4 | P 34.3

USD        Baker Hughes U.S. Rig Count (SEP 6) A 898 | C 898 | P 904

 

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