Daily Market Analysis

Asian Session – Sterling hits new 3-week high; dollar drops below 103 yen on US election jitters

Posted on November 3, 2016 at 7:32 am GMT

After a two-day meeting, the Federal Reserve announced on Wednesday that it held interest rates steady again. No rate hike by the Fed was widely expected by the markets because of the growing uncertainty around the upcoming US election. The Fed released a statement that acknowledged the case for a rate hike is getting stronger and left the door open for a move in December. They indicated that they would prefer to wait for further evidence of progress in the [..]

European Session – Sterling rallies on UK construction PMI, dollar weakness persists on US election worries

Posted on November 2, 2016 at 3:07 pm GMT

Risk aversion continued to grip the markets in today’s European session as US election worries grow, lending support to safe haven assets. The dollar extended losses against many counterparts while gold was bid. Economic data released during the European session were on PMI surveys for the Eurozone manufacturing and UK construction sectors but these were a temporary distraction for the markets as the focus was elsewhere, primarily on the US elections. Sterling received an added boost after UK construction PMI [..]

Asian Session – Dollar weakens as focus turns to US election uncertainty, gold rallies

Posted on November 2, 2016 at 7:10 am GMT

There was a risk off environment in Asia on Wednesday which followed through from the US session. The selloff in the US dollar played on sentiment and therefore safe havens like gold and the yen gained. The upbeat sentiment on Tuesday from strong China PMI data has faded as the focus turned to the US elections. Equity markets also joined the selloff while the VIX (volatility index) rose. Some recent polls show Republican candidate Donald Trump leading Democratic candidate Hillary [..]

European Session – Dollar under pressure despite strong ISM as FOMC, elections draw nearer

Posted on November 1, 2016 at 3:32 pm GMT

The US dollar drifted lower in European trading on Tuesday as attention turned to the Fed’s two-day policy meeting, which starts today. Worries that Hillary Clinton, the Democratic nominee, may be losing ground to her Republican rival, Donald Trump, in the US presidential race also weighed on the greenback today. The euro broke above 1.10 dollars on the back of the weaker dollar but the single currency was also strong against the pound. There was no data out of the [..]

Asian Session – Aussie surges as RBA holds policy and China PMI jumps

Posted on November 1, 2016 at 7:15 am GMT

News and data out during Tuesday’s Asian session kept sentiment upbeat. The Australian dollar saw some notable moves due to strong China manufacturing PMI data and a decision by the Reserve Bank of Australia to hold policy steady. Both sets of October manufacturing PMI data out of China beat forecasts and this also helped support the aussie since China is a major trading partner of Australia. The final Caixin manufacturing PMI jumped to 51.2, well above the expected 50.2 and [..]

European Session – Dollar reclaims 105 yen level but euro unfazed by Eurozone CPI and GDP data

Posted on October 31, 2016 at 3:13 pm GMT

Trading remained cautious in today’s European session as investors assessed the potential damage to Hillary Clinton’s chances of winning the US elections following the fallout from the FBI’s decision to reopen the investigation into Clinton’s emails. The US dollar extended its rebound from the Asian session to reclaim the 105 level against the yen. Adding support to the greenback today were solid consumer spending data which come on top of Friday’s better-than-expected GDP data. The recovering dollar pulled other majors [..]

Asian Session – US dollar recovers from lows following FBI warrant for Clinton emails

Posted on October 31, 2016 at 8:44 am GMT

The US dollar was off the lows hit on Friday after revelations that new evidence had surfaced in the Clinton email investigation, which brought fresh uncertainty for the US elections. Euro / dollar dipped back to 1.0960 whereas dollar / yen recovered close to 105 yen at 104.90. Euro / dollar had reached just below 1.10 in the aftermath of the news that compromised Clinton while dollar / yen reached as low as 104.36. Economic news out of Japan was not supportive [..]

European Session – UK GDP defies Brexit gloom but unable to lift pound; Dollar breaks above 105 yen

Posted on October 27, 2016 at 3:09 pm GMT

The US dollar remained underpinned by Fed rate hike expectations as it hit a fresh 3-month high against the yen in today’s European session, while the pound was unable to break above its recent range after UK growth beat expectations. The British economy defied fears of a Brexit-induced slowdown to grow by 0.5% q/q in the third quarter, only moderately weaker than the 0.7% rate of the second quarter. Expectations were for UK growth to more than halve to 0.3%. [..]

Asian Session – US dollar steady as market awaits GDP numbers tomorrow

Posted on October 27, 2016 at 7:27 am GMT

The US dollar was well-bid as 10-year Treasury yields reached 4½-month highs during the past couple of days. The 10-year yield in the United States was at 1.80% having reached as low as 1.32% back in early July in the aftermath of the Brexit referendum. The rise in Treasury yields was due to renewed confidence that the Fed would soon resume to raise rates. Euro / dollar however was still narrowly holding on to the 1.09 mark by trading at [..]

European Session – Dollar and oil firmer after data; Sterling awaits Q3 GDP above $1.22

Posted on October 26, 2016 at 2:53 pm GMT

Weaker crude oil prices weighed on market sentiment in Wednesday’s European session as energy stocks were dragged lower even as the dollar eased from yesterday’s near 9-month highs. Crude oil extended yesterday’s losses as investors grew sceptical whether major oil producers would be able to agree to significant measures next month that would help reduce the supply glut. Oil also came under pressure yesterday from Tuesday’s API inventory data that showed US crude stocks rose by more than expected last [..]

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