Forex news from the European morning session - 30 November 2018
Headlines:
- Italy Q3 final GDP -0.1% vs 0.0% q/q prelim
- Eurozone November preliminary core CPI +1.0% vs +1.1% y/y expected
- Did dollar buyers do their Christmas shopping a little earlier this year?
- UK's Fox says Theresa May has been changing the public mood on Brexit vote
- Switzerland November KOF leading indicator 99.1 vs 99.5 expected
- France November preliminary CPI -0.2% vs -0.2% m/m expected
- China says hopes that US can show sincerity in talks
- Italy's Conte, Tria reported to be working on a plan to cut deficit target to 2%
- Germany October retail sales -0.3% vs +0.4% m/m expected
- UK November Nationwide house price index +0.3% vs +0.1% m/m expected
- ECB's Villeroy: Euro is part of solutions for Italy's economic problems
Markets:
- NZD leads, GBP lags on the day
- European equities mostly lower; E-minis down 0.5%
- US 10-year yields down 1.8 bps to 3.011%
- Gold down 0.16% to $1,222.28
- WTI down 1.61% to $50.62
- Bitcoin down 4.94% to $3,976
Markets began the session with a lighter mood as equities were trading tepidly and currencies were stuck in extremely narrow ranges with one eye being kept on the Trump-Xi summit to come over the weekend. European equities opened rather flat too and markets didn't really budge up until the release of the Eurozone November CPI figures.
Call it coincidence or what not but following the data release, markets sprung into life with the dollar picking up traction against the rest of the major bloc. There was also a slight hint of risk aversion as auto stocks are weighed down in European trading again, driving down regional equities as a whole.
EUR/USD fell from 1.1380 to a low of 1.1358 before recovering now towards 1.1370 levels again ahead of US trading. Meanwhile, cable fell rather substantially as the pound continues to fail to catch a break ahead of the parliament vote on 11 December. The pair dipped from 1.2780 to a low of 1.2745 before holding up now near 1.2750.
As the dollar pushed higher, commodity currencies also fell against the greenback with USD/CAD rising from 1.3290 levels to a high of 1.3321 as oil began to give back some gains as well. AUD/USD also fell from 0.7315 to a low of 0.7296 and now hugs the 0.7300 handle awaiting the next session to provide further direction.
There wasn't much else going on in markets but keep an eye on risk as it will be the key determinant in trading towards the close of the week and at the open of next week with the Trump-Xi summit the main event that markets are waiting on right now.
On a side note, I'd like to apologise if I missed out some comments over the past few days or if I've been a bit off in the posts/updates. I've been a bit under the weather after contracting a rather strong strain of the flu, fingers crossed the meds will flush out the virus by next week! Anyway, I wish you all a great rest of the day and have a great weekend!
