Daily Market Analysis

European Session – Euro see-saws as ECB shocks by cutting size of bond purchases

Posted on December 8, 2016 at 3:33 pm GMT

The euro’s steady ascent in today’s European session came to an abrupt end after the European Central Bank surprised markets by unexpectedly reducing the size of its asset purchase program. At its latest policy decision, the ECB kept its main interest rates unchanged but defied consensus expectations that it would continue purchasing Eurozone government bonds at a monthly pace of €80 billion, and instead announced it will reduce the size to €60 billion from April 2017. The ECB also surprised [..]

Asian Session – Euro edges higher as focus turns to crucial ECB meeting; China reports upbeat trade data

Posted on December 8, 2016 at 6:01 am GMT

Market sentiment was upbeat in the Asian session today and received an added boost after China reported much better than expected trade data. Both imports and exports rose to leave a trade surplus of $44.6 billion. China is the second largest world economy, and today’s data is an indication of stronger global, as well as domestic demand. Imports rose 6.7% year-on-year, contrary to expectations of a 1.3% decrease, while exports increased 0.10% year-on-year versus a projected 5% decline. Both readings [..]

European Session – Pound slips on weak data, Brexit vote but euro firmer ahead of ECB

Posted on December 7, 2016 at 3:45 pm GMT

Major currencies were struggling for direction in Wednesday’s European session as cautiousness set in ahead of tomorrow’s ECB policy decision and next week’s FOMC meeting. The US dollar and the euro were confined to tight ranges but the pound underperformed as a combination of disappointing data and Brexit developments took their toll on the British currency. The euro benefited from positive risk sentiment brought about by reports suggesting Italy’s third biggest lender will likely receive a state bailout. This eased [..]

Asian Session – Aussie drops on negative Australian GDP number

Posted on December 7, 2016 at 7:47 am GMT

The Australian dollar was one of the worst performing major currencies in today’s Asian session after GDP data showed the Australian economy contracted more than expected in the third quarter. The aussie tumbled to $0.7415 from $0.7473 in reaction to news of the worst contraction since the financial crisis. Third quarter GDP fell 0.5% quarter-on-quarter and was the first negative result since the first quarter of 2011. In the previous quarter, GDP rose a revised 0.6%. Today’s number was much [..]

European Session – Euro steadier as Italy remains in spotlight; Dollar slightly firmer

Posted on December 6, 2016 at 3:44 pm GMT

Major currencies were steadier in European trading on Tuesday with the euro and the pound holding near multi-week highs, while the US dollar firmed from yesterday’s 3-week low. The positive risk sentiment from Asia carried forward to the European session with major European stock indices extending Monday’s gains. Reports that the Italian government was preparing a state aid for the country’s third largest bank, Monte dei Paschi di Siena, helped the recovery in risk appetite following the rejection by Italian [..]

Asian Session – Aussie falls after RBA cautions on slower growth; euro consolidates gains

Posted on December 6, 2016 at 7:47 am GMT

The Australian dollar was in focus in today’s Asian session as the Reserve Bank of Australia held its monthly policy meeting. The RBA decided to leave the cash rate unchanged at 1.50% as expected and its statement cautioned about a slowdown in growth in the near term. All eyes will be on Wednesday’s third quarter GDP report, which many economists forecast will show the Australian economy contracted. The aussie fell after the RBA announcement but the currency had already started [..]

European Session – Euro in sharp reversal as Italy vote shock dissipates; Sterling at 2-month high as Brexit hearing gets underway

Posted on December 5, 2016 at 3:58 pm GMT

The euro made a dramatic turnaround after slumping to its lowest since March 2015 earlier in the day as markets reacted to the expected ‘No’ vote in Italy’s referendum on constitutional reforms. However, market calm was soon restored with both the single currency and European stocks heading higher, while sterling climbed back towards 2-month highs even as the UK Supreme Court started deliberating on the Brexit hearing. Fears that the Italian voters’ rejection of changes to the country’s constitution would [..]

Asian Session – Euro plunges to 20-month low in reaction to Italian referendum No vote

Posted on December 5, 2016 at 6:49 am GMT

The euro plunged against the US dollar to reach its lowest level in 20-months after news that a referendum on constitutional change in Italy on Sunday resulted in a “no” vote. This prompted Prime Minister Matteo Renzi to announce his resignation. The referendum was also seen as a vote of confidence for Renzi and after suffering a crushing defeat this weekend, his resignation brings political uncertainty to one of the Eurozone’s largest economies. The rejection of the proposal for constitutional [..]

European Session – Dollar snaps three-weeks of gains, falls after nonfarm payrolls

Posted on December 2, 2016 at 3:53 pm GMT

The dollar snapped three weeks of gains today and fell on the release of the latest US jobs report. The actual payrolls number beat forecasts and rose in November, while the unemployment rate fell to the lowest in nine years. But average hourly earnings were a miss and fell by 0.1% versus a 0.2% increase expected. The dollar weakened across the board after the jobs data. Against the yen, it dropped below the key 114 yen level to reach 113.32 [..]

Asian session – US Dollar trims gains ahead of nonfarm payrolls; aussie buoyed by retail sales data

Posted on December 2, 2016 at 8:31 am GMT

The US dollar and Treasury yields were lower in Friday’s Asian session as investors were cautious ahead of the nonfarm payrolls report. The rally in oil prices fizzled out today following a boost after the OPEC deal reached on Wednesday. The euro rose to a two-week high of $1.0689 in the Asian session, helped by a broadly weaker greenback. It is on track to end the week higher against the dollar but the main risk for the single currency will [..]

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