Forex news for US trading on Jan 14, 2016:
- Bank of England MPC votes 8-1 to keep interest rates unchanged
- BOE MPC Minutes: Rates expected to rise gradually but to lower level than previous cycles
- ECB minutes signal compromise on future actions
- ECB Minutes: Downside risk seen from external factors
- Fed's Bullard says return to inflation target may take longer than thought
- Bullard: Fed isn't thinking about a January hike
- November 2015 Canadian new house prices 0.2% vs 0.2% exp m/m
- US initial jobless claims 284K vs. 275K estimate.
- December 2015 US import prices -1.2% vs -1.4% exp m/m
- Gold down $19 to $1078
- WTI crude up 73-cents to $31.21
- S&P 500 up 31 points to 1921
- AUD leads, NZD lags
Once again, it wasn't really a headline driven market. The real debate was whether Bullard had an impact on overall sentiment.
On the one hand, he sketched out a path for the Fed to back down from rate hikes by pointing to lower breakevens and the potential for oil declines. On the other hand, he continued to emphasize 4 rate hikes.
I'd look at the metaphorical third hand and point out that Bullard has a long track record of making bizarre statements and there's plenty of evidence that he doesn't have any pull within the Fed.
So where does that leave us? It's the same kind of market it's been since the start of 2016. The market is trading on emotion and technicals, not news.
