The week has kicked off with a bang after the Japanese MoF sanctioned another round of intervention in the currency markets, taking USDJPY sharply higher from 75.60-65 to a peak of 79.53. It is the third time this year Japanese policy makers have attempted to weaken the JPY through currency intervention, and whilst it is not entirely surprising given the recent price action, many had predicted that the next intervention would be more likely after this week’s FOMC meeting. For now, we doubt that the MoF will announce a formal exchange rate floor in the spirit of the SNB’s EURCHF floor, but the cat and mouse games between speculators and policymakers is likely to continue for some time.
In other weekend news, broker-dealer firm MF Global is rumoured to be on the brink of filing for bankruptcy protection today; a story which is weighing on risk appetite and thereby most Asian stock markets. The Nikkei is down -0.7%, Hang Seng -1.1% and Shanghai Composite -0.2%. Talks are said to be ongoing about an imminent sale of the firm’s assets, so expect risk sentiment to continue to lurch around until a satisfactory resolution is reached.
Coming up in today’s European session, the main highlights will be Eurozone CPI and unemployment readings. The CPI estimate for October is forecast to moderate somewhat to 2.9% YoY, down from last month’s 3.0% print, whilst unemployment is expected to remain at 10.0%. Also due this morning, Norwegian retail sales growth is expected to slow to 0.2% MoM, 2.2% YoY, down from last month’s 1.3% MoM, 7.6% YoY level.
In the afternoon, market attention turns to Canada’s August GDP and US Chicago PMI figures for October.
M.Zohaib Gadit
Forex Trading Consultant
In other weekend news, broker-dealer firm MF Global is rumoured to be on the brink of filing for bankruptcy protection today; a story which is weighing on risk appetite and thereby most Asian stock markets. The Nikkei is down -0.7%, Hang Seng -1.1% and Shanghai Composite -0.2%. Talks are said to be ongoing about an imminent sale of the firm’s assets, so expect risk sentiment to continue to lurch around until a satisfactory resolution is reached.
Coming up in today’s European session, the main highlights will be Eurozone CPI and unemployment readings. The CPI estimate for October is forecast to moderate somewhat to 2.9% YoY, down from last month’s 3.0% print, whilst unemployment is expected to remain at 10.0%. Also due this morning, Norwegian retail sales growth is expected to slow to 0.2% MoM, 2.2% YoY, down from last month’s 1.3% MoM, 7.6% YoY level.
In the afternoon, market attention turns to Canada’s August GDP and US Chicago PMI figures for October.
M.Zohaib Gadit
Forex Trading Consultant
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