Forex news for US trading on February 10, 2016:
- Yellen says equity declines and dollar strength could weigh on economic activity
- Full text of Yellen's Humphrey Hawkins statement
- What's behind the global market uncertainty, according to Janet Yellen
- Yellen: We are watching global markets very carefully
- Yellen unsure if Fed can legally impose negative rates
- Chris Christie ends bid for President
- Carly Fiorina drops out of Presidential race
- Warren Buffett's right-hand man says American finance 'out of control'
- US sells 10-year notes 1.730% vs 1.745% WI
- Devon Energy hires Jefferies to sell $2-3B in assets
- Saudis would join a cut if Russia and other non-OPEC countries joined
- EIA US weekly oil inventories -754K vs +2850K expected
- BP CEO 'very bearish' on oil
- January 2016 UK NIESR GDP 0.4% vs 0.6% 3m/3m prior
- OECD: Negative interest rates are dangerous
- Fed's Fischer: New US financial regulation framework still untested by crisis
- ECB's Praet: Provision of ELA has a broader scope than monetary policy operations
- Gold up $7 to $1196
- WTI crude down 38-cents to $27.56
- S&P 500 flat at 1851
- US 10-year yields down 3 bps to 1.69%
- JPY leads, CAD lags
The US dollar first rallied as Yellen offered some token concessions to roiled markets but it soon reversed and the US dollar finished on the US lows against the euro, yen and pound.
The headline that may have sparked the turnaround was the talk about investigating negative rates but I believe it would have come either way. She just didn't offer enough insight into what's happening in markets to shore up confidence in central bankers.
EUR/USD fell hard early and hit 1.1161, which was a pip below the previous day's low. But it was a short-lived drop and recovered within a few hours and continued a climb up to 1.1292, which was where European trading got underway.
USD/JPY matched the European high of 115.26 but couldn't break it and then started a steep decline that accelerated on low yields at a 10yr Treasury auction. the first leg of selling hit 113.75 and the second leg hit 113.15 in a nearly 200 pip daily fall.
Cable rallied to 1.4578 in European trading but fell as US traders arrived and continued to decline down to 1.4450, which was well-above the earlier and prior day's lows. That was a good signal and as the US dollar lost ground, it climbed to 1.4524.
USD/CAD was a whipsaw today along with oil and the dollar. This pair got the worst of it as it bounced around 1.3825 to nearly 1.4000 at the highs.
AUD/USD chopped in the 0.7070 to 0.7126 range, failing to take out either side in US trading.