Market Review - 20/10/2014 22:50GMT
Dollar falls broadly on rate hike concerns
The greenback weakened against majority of its peers on Monday on increased speculation that the Federal Reserve may push back its plan on the first rate hike.
Versus the Japanese yen, the greenback opened higher to 107.27 in New Zealand on weekend news that GPIF will raise its holdings in foreign bonds. Dollar continued to trade with a firm bias and rose to session high at 107.39 in Asian morning, however, price pared its gains and dropped to an intra-day low at 106.79 on dollar's broad-based weakness as investors pushed back expectations of a rate hike from the Federal Reserve.
Japanese newspaper Nikkei reported GPIF will also boost its holdings of foreign bonds and stocks to about a combined 30% from 23%, while reducing domestic notes to the 40% level from 60%.
Despite opening slightly lower and weakening to 1.2736 in Australia, the single currency rebounded to 1.2770 in Asian morning before falling to an intra-day low at 1.2732 at European open. However, euro pared its losses and rebounded to 1.2778 in European morning after data showed an increase in Italian industrial sales. Price continued to ratchet higher and rose to session high at 1.2817 in New York afternoon on dollar's broad-based weakness.
The British pound traded in a sideways manner in Asia before falling to session low at 1.6080 at European open. However, cable pared its losses and rose to 1.6148 in European morning, helped by cross-buying of sterling vs euro. Price continued to edger higher and rose to an intra-day high at 1.6179 in New York afternoon.
In other news, Fed's Fisher said 'underlying economy is improving, I don't see any need to not curtain QE3 at October meeting; no slide to downside on inflation, no pressure on upside either; expect to see biggest impact on Texas economy fm Ebola scare; QE3 program did help reduce unemployment in U.S.; timing of Fed rate rise will depend on economic data; I am not going to give a specific date on when I expect rate rise to be appropriate.'
On the data front, German Statistic Office showed PPI in Sept at 0.0% m/m n -1.0% y/y, same as expectations.
Data to be released on Tuesday:
Australia CB leading indicator, Westpac leading index, RBA minutes, China GDP, retail sales, industrial output, Japan industry index, Swiss trade balance, UK PSNB, PSNCR, U.S. Redbook retail sales and existing home sales.
Dollar falls broadly on rate hike concerns
The greenback weakened against majority of its peers on Monday on increased speculation that the Federal Reserve may push back its plan on the first rate hike.
Versus the Japanese yen, the greenback opened higher to 107.27 in New Zealand on weekend news that GPIF will raise its holdings in foreign bonds. Dollar continued to trade with a firm bias and rose to session high at 107.39 in Asian morning, however, price pared its gains and dropped to an intra-day low at 106.79 on dollar's broad-based weakness as investors pushed back expectations of a rate hike from the Federal Reserve.
Japanese newspaper Nikkei reported GPIF will also boost its holdings of foreign bonds and stocks to about a combined 30% from 23%, while reducing domestic notes to the 40% level from 60%.
Despite opening slightly lower and weakening to 1.2736 in Australia, the single currency rebounded to 1.2770 in Asian morning before falling to an intra-day low at 1.2732 at European open. However, euro pared its losses and rebounded to 1.2778 in European morning after data showed an increase in Italian industrial sales. Price continued to ratchet higher and rose to session high at 1.2817 in New York afternoon on dollar's broad-based weakness.
The British pound traded in a sideways manner in Asia before falling to session low at 1.6080 at European open. However, cable pared its losses and rose to 1.6148 in European morning, helped by cross-buying of sterling vs euro. Price continued to edger higher and rose to an intra-day high at 1.6179 in New York afternoon.
In other news, Fed's Fisher said 'underlying economy is improving, I don't see any need to not curtain QE3 at October meeting; no slide to downside on inflation, no pressure on upside either; expect to see biggest impact on Texas economy fm Ebola scare; QE3 program did help reduce unemployment in U.S.; timing of Fed rate rise will depend on economic data; I am not going to give a specific date on when I expect rate rise to be appropriate.'
On the data front, German Statistic Office showed PPI in Sept at 0.0% m/m n -1.0% y/y, same as expectations.
Data to be released on Tuesday:
Australia CB leading indicator, Westpac leading index, RBA minutes, China GDP, retail sales, industrial output, Japan industry index, Swiss trade balance, UK PSNB, PSNCR, U.S. Redbook retail sales and existing home sales.
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