Forex news for NY trading on December 12, 2018
- Theresa May wins Conservative leadership challenge 200-117
- US stocks end higher
- ECB preview: The end of QE, the continuation of some bad habits
- Here is when the results of May's leadership challenge will be announced
- Crude oil futures settle at $51.15
- Macron now stands for nothing
- US sells 10-year notes at 2.915% vs 2.915% WI bid
- Italy PM Conte proposes 2.04% deficit target for 2019 to EU
- France finance minister says deficit will overshoot EU's 3% limit in 2019
- May told Conservatives she will not stand in the next election
- Michael Cohen sentenced to three years in jail
- Chinese companies buy more than $180 million worth of US soybeans - report
- European stocks end with solid gains
- Sterling rally continues in third-best day of the year. What are the odds of a real Brexit deal?
- US EIA weekly crude oil inventories -1208K vs -3500K expected
- US rejects WTO reform proposal
- China drafting replacement for Made in China 2025 plan - report
- Germany said to intensify plans to fix Deutsche Bank with merger
- Any assurances given to May cannot contradict current deal - EU official
- Canada Q3 capacity utilization 82.6% vs 86.0% expected
- US November CPI 2.2% vs 2.2% y/y expected
- The GBP is the strongest. The NZD is the weakest as NA trader enter for the day
In other markets near the end of the NY session:
- Spot gold is up $2.77 or 0.22% at $1245.97. The high reached $1247.43. The low extended to $1242.03
- WTI crude oil fell -$0.52 after the draw in inventories was much less than the private estimates from late yesterday. The current price is at $51.11. The $50 level remains a key barometer for bulls/bears
- Bitcoin on Coinbase is trading up $58 at $3441. For a technical look at the pair, click here
The US stocks are ending the day up around 1% to 1.5% on the day, but off the session highs. European shares soared with all the major indices rising over 1%..
In the US debt market today, the US yields moved higher. The US sold the 10 year notes at 2.915% which was right on the WI level. The bid to cover came fairly low at 2.35x vs 2.54x at the last auction
In the European 10 year benchmark debt market, the yield were mixed. Italian yields fell on hope that budget drama will be resolved soon.
Fundamentally today, the US CPI came out as expected at 2.2%, the ex food and energy and the MoM numbers all came in as expected as well. It did not have a great impact on the forex market.
Canada capacity utilization was weaker at 82.6% vs 86% expected. Despite the weakness, the USDCAD fell lower (USD weakness to blame). However, the central bank may take note down the road.
On the geopolitical front today, the big event was the Tories no-confidence vote of PM Theresa May. The PM needed 158 votes to avoid defeat, and ended up surviving the vote 200-117. However, the vote was still not all that favorable for the PM and her Brexit agenda. Before the vote May did - for the most part - admit that she is a beaten party leader and that she would not run for the party leadership at the next general election.
All the anxiety from the vote and uncertainty, initially in the day led to losses for the GBP, but when a new 20 month low was rejected and the price moved back above the 1.2500 level, shorts were forced to cover and the GBP (and all the crosses) moved higher. The vote tally reached toward the end of the day, did push the GBP lower with the GBPUSD moving back below its 100 hour MA at 1.26437. So the day's rally, might be it for now as focus now shifts back to the Brexit.
Overall, for the day, the GBP is still ending the session as the strongest of the major currencies. The NZD is the weakest. The USD was mostly lower with most of the declines on the back of a 1.23% fall vs. the GBP. The greenback is also ending the day down -0.50% vs the EUR and -0.31% vs the CAD (despite that weak Capacity Utilization data out of Canada).
The pair did rise vs the NZD (+0.30%) with most of the rise happening in the Asian session. In the NY session, the NZDUSD waffled up and down but just above its 200 hour MA at 0.68455.
