Forex news from the European morning session - 2 December 2019
Headlines:
- Trump reiterates call for Fed to lower rates, laments 'strong US dollar'
- UK November final manufacturing PMI 48.9 vs 48.3 prelim
- Eurozone November final manufacturing PMI 46.9 vs 46.6 prelim
- Germany November final manufacturing PMI 44.1 vs 43.8 prelim
- France November final manufacturing PMI 51.7 vs 51.6 prelim
- OPEC+ said to be discussing deepening current oil output cuts at least until June
- Fed considers letting inflation run above target - report
- Germany apologises for brazen criticism of ECB policies
Markets:
- NZD leads, CAD lags on the day
- European equtiies lower; E-minis up 0.1%
- US 10-year yields up 5.7 bps to 1.833%
- Gold down 0.4% to $1,457.75
- WTI up 2.2% to $56.39
- Bitcoin down 5.8% to $7,267
Markets were buoyant to start the session but some of that optimism was sapped towards the end after Trump reinforced steel and aluminum tariffs on Brazil and Argentina.
Equities were initially a little more upbeat on positive Chinese data but gave back gains after Trump's tweet, with European stocks now in the red while US futures declined.
Treasury yields also slipped a little but are maintaining their advance for the most part across the curve with 10-year yields still sitting comfortably at around 1.833% now.
USD/JPY eased a little on the mixed mood as the pair fell from 108.70 to 108.50 levels but gold continued to stay weaker and pressured under $1,460 amid the selloff in bonds.
The aussie and kiwi were more upbeat throughout the session though with NZD/USD rising to a three-and-a-half months high above its 100-day moving average. The push lower in AUD/NZD below 1.0500 is also helping to give the kiwi an added lift on the day.
In other news, oil is also underpinned by reports of OPEC+ possibly considering deeper output cuts ahead of this week's meeting in Vienna. However, the loonie is not able to build on that as USD/CAD rises back above 1.3300 ahead of North American trading.
Looking ahead, the risk mood remains a key factor to watch out for in trading today. As such, be wary of US ISM manufacturing data as it could play into the sentiment we're seeing in markets currently.
