Forex news for North American trading on February 20, 2019:
- Fed Minutes note concern about slowing global growth and China
- UK AA rating may be cut by Fitch
- May says she's seeking 'legally binding changes to the backstop'
- May and Juncker say talks were 'constructive' in joint statement
- Fed Minutes note concern about slowing global growth and China
- Trump says negotiating with EU, will do tariffs if there is no deal
- Caterpillar: China 2019 demand is 'very strong'
- Fed's Kaplan: Global growth deceleration likely to continue
- Mueller investigation could be completed as soon as next week - report
- Spain sees 2019 deficit at 2.2%-2.4% without new budget - State Economist
- Eurozone February advance consumer confidence -7.4 vs -7.2 prior
- Zimbabwe abandons 1:1 currency peg with the US dollar
- Tesla general counsel quits after just two months on the job
Markets:
- Gold down $2 to $1338
- WTI crude up 83-cents to $56.92
- S&P 500 up 5 points to 2784
- US 10-year yields up 1 bps to 2.65%
- CAD leads, NZD lags
The calendar was light so the FOMC Minutes got much more attention than usual. The dollar rallied in the aftermath on the upbeat assessment of the domestic economy and negative view on foreign growth. The balance sheet commentary affirmed that the runoff is likely to end in H2 but bonds shrugged it off.
USD/JPY was near the 110.62 session low ahead of the data and immediately jumped to 110.80 afterwards and eventually ticked to 110.90 which is a quarter-cent gain on the day.
Overall market moves in FX were similarly uninspiring with generally modest moves.
Cable rose for the fifth day on an interview with Spain's foreign minister saying they were hammering out a Brexit deal. The market bought the headlines at first in a rally above 1.3100 but skepticism set in and the pound fell back to 1.3050 before a further fall on teh ratings news.
EUR/USD hit 1.1370 in a two-week high before it gave up all its gains on the FOMC Minutes in a fall to a slight loss on the day at 1.1337.
USD/CAD was pulled lower by the sixth day in oil gains. It fell as low as 1.3150 before bids there drew a line under the pair. The FOMC Minutes inspired a 25 pip bounced to 1.3175.
Gold was in interesting case as it rose to a fresh 10-month high of $1346 in Asian trade. A second attempt at that was staged in New York but fell just short then dollar buying after the FOMC Minutes led to some profit taking and a quick fall to $1338. That ends the winning streak at four days.