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End Of Month Fixing Flows Dominate FX Markets
November 30, 2009 6:05 PM CET
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G10 Advancers and Decliners vs USD |
| | AUD | 0.83 |  | | | NZD | 0.42 | | | | CAD | 0.37 | | | | JPY | 0.36 | | | | CHF | 0.02 | | | | DKK | 0.00 | |  | EUR | -0.01 | | | NOK | -0.40 | | | SEK | -0.54 | | | GBP | -0.62 | |
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Global Indexes |
Current Level |
% Change |
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| FTSE 100 Index | 5'197.10 | - 0.93 | | DAX Index | 5'627.06 | - 1.03 | | SMI Index | 6'260.95 | - 1.19 | | S&P 500 Index | 1'087.53 | - 0.36 | | DJIA Index | 10'275.39 | - 0.33 | | Nikkei 225 Futures | 9'260.00 | + 2.09 | | Hang Seng Futures | 21'748.00 | + 2.65 |
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World Markets |
Current Level |
% Change |
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| Gold | 1'172.30 | - 0.45 | | Silver | 18.28 | - 0.11 | | VIX | 25.36 | + 2.51 | | Crude wti | 76.15 | + 0.13 | | USD Index | 74.90 | + 0.04 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| Tue 1 Dec | --- | --- | --- | | RBA cash rate decision % Dec | 3.75 | 3.50 | AUD/03:30 | | Real GDP, % q/q Q3 | 0.3 | -0.3 | CHF/06:45 | | Manufacturing PMI, index Nov | 57.0 | 56.7 | SEK/07:30 | | Manufacturing PMI, index Nov | 55.2 | 54.0 | CHF/08:30 | | Germany: Final Manufacturing PMI, index Nov | 52.0 | 52.0 | EUR/08:55 | | Germany: Unemployment rate, % Nov | 8.1 | 8.1 | EUR/08:55 | | Final Manufacturing PMI, index Nov | 51.0 | 51.0 | EUR/09:00 | | Manufacturing PMI, index Nov | 54.0 | 53.7 | GBP/09:30 | | Unemployment rate, % Oct | 9.8 | 9.7 | EUR/10:00 | | Construction spending, % m/m Oct | -0.5 | 0.8 | USD/15:00 | | ISM manufacturing index Nov | 54.8 | 55.7 | USD/15:00 | | Pending home sales, % m/m Oct | -1.0 | 6.1 | USD/15:00 |
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Currency Tech |
EURUSD
R 2: 1.5200
R 1: 1.5100
CURRENT: 1.4990
S 1: 1.4800
S 2: 1.4626
GBPUSD
R 2: 1.7040
R 1: 1.6845
CURRENT: 1.6400
S 1: 1.6380
S 2: 1.6272
USDJPY
R 2: 90.60
R 1: 88.20
CURRENT: 86.15
S 1: 85.87
S 2: 84.40
AUDUSD
R 2: 0.9406
R 1: 0.9323
CURRENT: 0.9140
S 1: 0.9056
S 2: 0.8947
USDCAD
R 2: 1.0781
R 1: 1.0749
CURRENT: 1.0585
S 1: 1.0451
S 2: 1.0418
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Market Brief |
FX markets have struggled to find a convincing direction today as global equities have been mixed on the day and Dubai fears have gradually receded into the background. Added to the lack of drivers, the advent of month-end has brought with it fixing flows that have added a level of unpredictability to FX moves. On the fundamental side, the morning session began with Norwegian Retail Sales that convincingly beat expectations with a 2.1% MoM gain in October against consensus estimates for 0.7%. At first EURNOK dropped from 8.4915 down to 8.4743 lows, but a rapid bout of profit-taking coupled with struggling European equity markets at the time caused a sharp reversal back above 8.53 levels, and it feels very much like year-end liquidation of positions to lock in profits is providing a decent supply of NOK similar to that seen in AUD and NZD recently.
UK M4 Money Supply data highlighted a lower 1.6% MoM print in October from last month’s 1.8% reading, and persistent EURGBP-buying throughout the day has put GBP under renewed pressure to sub-1.6400 levels. The key level to watch on the downside continues to be 1.6272, and ideally a closing break below there to confirm further bearish momentum.
The main release of the afternoon session as been Canadian Q3 GDP which missed forecasts for a 1.0% annualized pace of growth (actual: 0.4%), but nevertheless the print proved that Canada returned to growth in Q3 after last quarter’s -3.1% figures, and the reaction in USDCAD has been limited (last 1.0590). Chicago PMI figures revealed a healthy 56.1 reading in November, higher than both the 53.3 expected and 54.2 prior reading; but the late USD rally into the end of the European session is more likely due to end of day fixing orders than a genuine change in perception of the US outlook.
Looking ahead, the RBA decision overnight is likely to be a market-mover; as despite both the median estimates of economists surveyed by Bloomberg and our own prediction being a 25bps hike, Australian bills are pricing in the possibility of an on-hold decision. Other highlights due Tuesday include Swiss Q3 GDP, European PMI data, Eurozone Unemployment, and US ISM Manufacturing.
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Asian Session: Dubai News Fades
November 30, 2009 11:11 AM CET
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G10 Advancers and Decliners vs USD |
| | NZD | 1.52 | | | | AUD | 1.35 | | | | SEK | 0.73 | | | | DKK | 0.70 | | | | EUR | 0.69 | | | | NOK | 0.65 | | | | JPY | 0.63 | | | | CAD | 0.61 | | | | CHF | 0.58 | | | | GBP | 0.46 | |
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Global Indexes |
Current Level |
% Change |
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| Nikkei 225 Index | 9,345.55 | + 2.90 | | Hang Seng Index | 21,915.54 | + 3.69 | | Shanghai Index | 3,195.30 | + 3.10 | | FTSE futures | 5,243.50 | + 0.99 | | DAX futures | 5,715.50 | + 0.25 | | SMI Futures | 6,355.10 | + 0.35 | | S&P future | 1,096.00 | + 0.59 |
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World Markets |
Current Level |
% Change |
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| Gold | 1,174.97 | - 0.22 | | Silver | 18.28 | - 0.10 | | VIX | 24.74 | + 20.80 | | Crude wti | 76.64 | + 0.77 | | USD Index | 74.56 | - 0.40 |
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Todays Calender |
Estimates |
Previous |
Country / GMT |
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| BoE Mortgage Approvals (Oct) | 57,000 | 56,200 | GBP / 09.30 | | M4 Money Supply (Oct Final) | -- | 1.8%(11.0P | GBP / 09.30 | | CPI (Nov Prov.) | (+0.4%) | 0.2%(-0.1% | EUR / 10.00 | | GDP (Q3) | 1.0% | -3.4% | CAD / 13.30 | | Chicago PMI (Nov) | 53.0 | 54.2 | USD / 14.45 |
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Currency Tech |
AUDUSD
R 2: 0.9406
R 1: 0.9323
CURRENT: 0.9185
S 1: 0.9056
S 2: 0.8947
USDCAD
R 2: 1.0781
R 1: 1.0749
CURRENT: 1.0549
S 1: 1.0451
S 2: 1.0418
EURJPY
R 2: 133.61
R 1: 132.69
CURRENT: 129.84
S 1: 126.91
S 2: 124.39
USDMXN
R 2: 13.133
R 1: 13.089
CURRENT: 12.896
S 1: 12.790
S 2: 12.767
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Market Brief |
For now worries surrounding events in the UAE seem to have tapered off and markets have reengaged in risk correlated trades. Over the weekend, the AUE central bank stated that in order to boost liquidity it would offer liquidity to local and foreign banks. In addition, measures are expected if pressure on local markets does not ease. While local Middle East markets have opened lower, Asian regional indexes roared ahead. The Nikkei was up 2.90% and Shanghai was higher by 3.19% at the time of writing. There is growing conscious that credit events in Dubai are not a Lehman type of trigger to systemic collapse or indictment of EM environment, but merely a cautionary tale of construction booms. We are guardedly optimistic and watching events carefully (perhaps foretelling events in Greece ). The EURUSD has traded in the 1.4965-1.5085 range. USDJPY has traded from a high of 87.16 to a low of 86.04, Yet, USDJPY levels remain the key focus, as the market monitors intervention risks. Although Finance Minister Fujii was quoted in the Mainichi Daily today as stating that Japan will not weaken JPY, there is clearly a growing rift between the BoJ and the Governing LDP on proper JPY policy. Last week, Banking Minister Kamei fired a very public shoot stating that the BoJ was "asleep at the wheel as usual". On the economic front, Japan's Industrial production for October continued to grow but at the more leisurely pace of +0.5% vs. +2.5% exp m/m. and although still falling on an annualized basis, the rate of decline of housing starts moderated by more than expected to -27.1% y/y vs. -33.5% exp.
The EU's mission to China ended without agreement on the future of the CNY-USD peg, as another diplomatic envoy learned what we all know. China won't move unless it's in their best interest. Eurogroup Chairman Juncker stated he was "not advocating an immediate, short-term-oriented, dramatic change in Chinese monetary policy”. However, would like to see “an orderly and gradual appreciation of the CNY". After the meeting, Juncker commented "I can't say that I'm more optimistic than I was before I came here".
In Australia private sector credit stagnated, showing 0% growth versus expectations of + 0.2% m/m. Q3 company operating profit weakened by -2.1% q/q. Critical Building approvals data will be released tomorrow, two hours ahead of the RBA's decision. Markets are basically evenly split over 25bp or hold for tomorrow’s rate decision. We believe that RBA to preserve its 'gradual' tightening stance and lift rates 25bp as equity markets have firmed, Dubai risk have not spilt over to the broader financial system and domestic condition warrant less loose monetary policy.
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ACM Advanced Currency Markets SA (hereinafter referred as ACM) is a professional financial intermediary, directly regulated by the Swiss Federal Department of Finance, Anti Money Laundering Control Authority. As forex specialist, ACM provides only currency trading via highly professional forex trading software. All customers are aware that this information or any part thereof has been prepared without taking account of your objectives, financial situation and/or needs. This information is not intended as personalized investment advice and does not constitute a recommendation. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. The analysis is based on the information which ACM finds reliable and accurate, but ACM does not assume any responsibility for any material nor for the transactions made on the basis of the information or the estimates of the analysis. ACM cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct, indirect and/or consequential loss arising from any use of this information, document or its content. All opinions and estimates constitute ACM analysis as of the data and are subject to change without notice. ACM does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions. Past performance is not a reliable indicator of future performance.
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