FX News Today
FX Update: The Dollar has been holding mostly narrow ranges against most other currencies, though USDJPY showed a fresh six-week high at 112.07 during early the Tokyo session before settling around the 111.80 mark. Other Yen crosses also registered new highs, before settling, with the Japanese currency following its usual inverse correlative pattern with global stock market direction. The USD index (DXY) has remained broadly unchanged on the day, at 94.50, consolidating yesterday’s losses after the US CPI release. EURUSD is also near net unchanged heading into the London interbank open, at 1.1695, holding just below yesterday’s two-week peak of 1.1701. Cable has similarly held steady near yesterday’s highs. US data releases are up today, including retail sales and industrial production, with risks to the upside.
Asian Market Wrap: 20-year Treasury yields are down -0.2 bp at 2.968%, the 10-year JGB yield is up 0.2 bp at 0.103%, while stock markets moved broadly higher during the Asian session, after a technology-led rise in US markets yesterday. Cautious central banks in Europe, hopes of fresh US-Sino trade talks and a larger-than-expected rate hike in Turkey all make for a positive backdrop to sentiment as the week draws to a close. Topix and Nikkei are up 0.91% and -0.97% respectively. The Hang Seng gained 0.87% and the CSI 300 is up 0.15%, Shanghai and Shenzen Comp are down -0.04% and -0.41% though after Trump cast some doubts over reports of a new round of talks with China and the investment slowdown worsened according to latest data, indicating that policies intended to boost investment growth have not made and impact yet. U.S. futures are moving higher in tandem with FTSE 100 futures and oil prices are slightly higher with the front end Nymex future trading at USD 68.83 per barrel.
Charts of the Day
Main Macro Events Today
US Retail Sales – Expectations – Retail sales are expected to come out at 0.4% MoM in August, compared to 0.5% in July.
US Capacity Utilisation and Industrial Production Indices – Expectations – Both indices are expected to show the improvement in US macroeconomic developments over the past weeks, with Capacity Utilisation expected to stand at 78.2%, compared to 78.1% in July. Industrial production is expected to increase by 0.3%, compared to 0.1% last month.
US Michigan Consumer Sentiment – Expectations – Sentiment is expected to increase, again given the improvement in US macroeconomic conditions, to 96.6 compared to 96.2 in July.
Support and Resistance Levels
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