Forex news for North American trade on October 17, 2018:
- FOMC minutes: Number of Fed officials saw the need to hike above long-run level
- May: Everyone wants a deal and I believe a deal will happen
- May said to be weighing extending Brexit transition period
- May spokesman: Britain is not calling for an extension of implementation period
- Canada manufacturing sales for August -0.4% versus -0.6% expected
- US Sept housing starts 1201K vs 1210K expected
- Ross: US is not the one that's slowing things down with EU on trade
- BOE's Cunliffe: You could see a big sterling fall depending on Brexit outcome
- Cunliffe: Next crisis may be related to market liquidity
- Weekly US oil inventories +6490K vs +2500K expected
- Kudlow: China hasn't responded yet to US requests on trade
- US planning to withdraw from international postal treaty in move against China - report
- Saudi consul in Turkey relieved of duties and placed under investigation
- Mueller expected to issue major findings soon after midterms - report
Markets:
- Gold down $1.50 to $1223
- WTI crude down $1.87 to $70.05
- US 10-year yields up 3 bps to 3.20%
- S&P 500 down 1 points to 2809
- USD leads, CAD lags
The US dollar was strong throughout trading on Wednesday with some hiccups along the way. USD/JPY was at 112.25 as North American arrived then tracked down to 112.02 where bids at the figure held even as sentiment deteriorated. As stocks turned back higher so did this pair and the gains accelerated after some hawkish details in the FOMC minutes. That sent the pair to a six-day high of 112.58 as it closed near the highs.
EUR/USD was stuck in the doldrums in part due to continued pressure on Italian bonds and the expectation the EU will reject the budget. Italian 10s finished 9.5 bps higher to 3.55% and the euro tracked 75 pips lower to 1.1500, a one-week low.
Cable weakened on soft UK inflation but staged a rally early in US trading and rose to 1.3150 from 1.3100 but the bounce faded in the broad post-Minutes US dollar rally and the pair finished near 1.3115.
USD/CAD was especially strong in part due to weakening oil prices. The pair rallied 85 pips to 1.3020 as a steady bid underpinned the pair. Those gains erased the past two days of losses.
The other commodity currencies were also weak as AUD/USD dropped to 0.7100 and NZD/USD slid to 0.6548.
