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Forex Today: Antipodeans cheer trade deal optimism; GBP slips ahead of key UK data

Dhwani Mehta FXStreet

The market mood in Monday’s Asian trading was buoyed by the renewed optimism over the US-China trade deal signing, especially after the US Treasury Secretary Mnuchin said that China’s trade commitment with the US was unchanged in the translation.

The higher-yielding Antipodeans benefited the most, with the Kiwi outperforming across the fx space, having risen over 0.30%. The Aussie jumped to four-day highs at 0.6920 amid mixed Australian inflation figures and upbeat S&P report on the country’s sovereign credit rating. The anti-risk yen was on the back foot amid Japanese holiday-thinned trades and a better risk environment, as the Asian equities clocked fresh 19-month highs. Therefore, USD/JPY advanced in a bid to challenge the key 109.70 resistance. Markets shrugged off the latest Iranian rockets attack news that injured a few Iraqi servicemen at the airbases that housed the US troops in Iraq.

The pound was the biggest loser in Asia, in the face of increasing calls for a Bank of England (BOE) rate cut by the bank’s policymakers and ahead of key UK economic releases. GBP/USD lost 0.25% and traded around 1.3025 region. Meanwhile, EUR/USD kept the bid tone intact around 1.1130 levels amid weak US NFP data-led broad US dollar weakness.

Among other related markets, oil prices steadied near multi-week troughs, with WTI around $59 handle. Gold prices posted small losses below $1555 despite negative Treasury yields, as the risk-on tone curbed the demand for the safe-haven.

Main Topics in Asia

Rocket attack in Iraq base hosting US troops

US Treasury Secretary Mnuchin: There will be a phase two of China trade talks - Fox

PBOC Dep. Governor Yifei: China must promote pension investment to bolster capital market

European Union would not be rushed in negotiations with Britain - BBC

Robert O'Brien: Trump administration has “reached out to the North Koreans” – Axios

Australia's AAA rating not at risk from bushfires: S&P - Reuters

USD/IDR drops to fresh 23-month low amid USD weakness, headlines from Natuna

US Pres. Trump to Iran: No nuclear weapons and “don’t kill your protesters”

USD/THB: Taiwan dollar gains ground on President Tsai's election victory

Terms of US-China phase one trade deal will be balanced and legally binding on both sides – Global Times

China’s NDRC Vice Chairman Ning: China’s economic growth in 2019 met target

UK financial firms' sentiment improves for first time in four years - Survey

Bundesbank Official: Eurozone GDP growth expected at 1.1% in 2020

Key Focus Ahead

Markets brace for a busy start to a big week ahead, as the US-China phase one trade deal signing will remain in the spotlight amidst critical economic release from the US as well as from China.

Today’s EUR macro calendar sees the release of the second-liner Wholesale Price Index (WPI) data for December, due at 0700 GMT. Next of note remains the UK data dump dropping in at 0930 GMT. The UK data includes the monthly GDP growth figures, trade balance, industrial and manufacturing production data. The data will be closely watched after several Bank of England (BOE) policymakers recently noted that the central bank is open to rate cuts as the next policy move.

Looking ahead, the US docket is data empty and hence, traders will keep an eye on the Bank of Canada (BOC) Business Outlook Survey and New Zealand’s NZEIR Q4 Business Confidence data for some fresh trading cues in the NA session.

Meanwhile, fresh UK political developments and updates on the US-China trade front will continue to offer some momentum to the markets.

EUR/USD: Dollar under pressure due to weak US jobs data

EUR/USD challenges the former support-turned-resistance line at 1.1132. Friday's dismal US data is likely powering gains and may continue to drive the pair higher in Europe. The euro could also draw bids on US-China trade optimism.

GBP/USD under pressure below 1.3050 ahead of UK data dump

GBP/USD trades weaker around 1.3040 ahead of key UK macro releases. The pair highlights the dovish tone from the BOE and the EU-Irish pessimism surrounding the Brexit while ignoring British forms’ positive outlook and USD weakness.

Forex Weekly Outlook – US consumer in focus after the Mid-East flare-up

As the dust settles from the Non-Farm Payrolls, the focus shifts to consumer data, while the Chinese GDP report is also of high interest. Here the highlights for the upcoming week.

Week ahead – It’s a trade deal!

As far as the coming week goes, politics will continue to dominate but there are some interesting central bank meetings, as well as a few interesting economic releases that will certainly draw attention.

GMT	Event	Actual	Consensus	Previous
Sunday, Jan 12
24h	JPY Coming-of-Age Day
Monday, Jan 13
00:00	AUD TD Securities Inflation (YoY)	1.4%		1.5%
00:00	AUD TD Securities Inflation (MoM)	0.3%		0.0%
05:00	EUR Consumer Price Index (YoY)			0.7%
06:00	EUR Gross Domestic Product (YoY)			1.5%
07:00	EUR Wholesale Price Index (MoM)			-0.1%
07:00	EUR Wholesale Price Index (YoY)			-2.5%
07:00	TRY Current Account Balance		$-0.420B	$1.549B
08:00	CZK Consumer Price Index (YoY)		2.9%	3.1%
08:00	CZK Consumer Price Index (MoM)		0.1%	0.3%
08:00	CZK Retail Sales (YoY)		3.8%	3.4%
09:00	EUR Retail Sales s.a. (MoM)		0.3%	-0.2%
09:00	EUR Retail Sales n.s.a (YoY)		-0.6%	1.0%
09:00	CZK Current Account (MoM)			-2.58B
09:30	GBP Manufacturing Production (YoY)		-1.6%	-1.2%
09:30	GBP Industrial Production (MoM)		-0.2%	0.1%
09:30	GBP Manufacturing Production (MoM)		-0.2%	0.2%
09:30	GBP Industrial Production (YoY)		-1.4%	-1.3%
09:30	GBP Total Business Investment (YoY)		-1.3%	0.5%
09:30	GBP Total Business Investment (QoQ)		-0.5%	0.0%
09:30	GBP Index of Services (3M/3M)		0.2%	0.2%
09:30	GBP Trade Balance; non-EU		£-3.764B	£-5.729B
09:30	GBP Total Trade Balance			£-5.188B
09:30	GBP Goods Trade Balance		£-11.603B	£-14.486B
09:30	GBP Gross Domestic Product (MoM)		0%	0%
n/a	EUR Consumer Price Index - Harmonized (YoY)		0.7%	0.5%
n/a	EUR Consumer Price Index (YoY)		0.7%	0.2%
n/a	GBP NIESR GDP Estimate (3M)		-0.3%	0.0%
11:00	EUR Consumer Price Index (MoM)			-0.1%
11:00	EUR Consumer Price Index (YoY)			0.4%
11:00	ILS Imports			$5,611M
11:00	ILS Exports			$4,632.8M
11:00	ILS Trade Balance			$-978.2M
13:00	PLN Current Account		€330M	€529M
15:00	COP Trade Balance			$-813.3M
15:30	CAD Bank of Canada Business Outlook Survey
16:30	USD 6-Month Bill Auction			1.52%
16:30	USD 3-Month Bill Auction			1.52%
21:00	NZD NZIER Business Confidence (QoQ)			-40%
21:45	NZD Building Permits s.a. (MoM)		2.1%	-1.1%
23:50	JPY Bank Lending (YoY)		2.1%	2.1%
23:50	JPY Current Account n.s.a.		¥1,423.3B	¥1,816.8B
23:50	JPY Trade Balance - BOP Basis		¥-412.6B	¥254.0B
Tuesday, Jan 14
05:00	JPY Eco Watchers Survey: Current		36.9	39.4
05:00	JPY Eco Watchers Survey: Outlook		44.7	45.7
06:30	INR WPI Inflation		2.15%	0.58%
07:00	CNY Imports (YoY)		9.6%	0.5%
07:00	CNY Trade Balance CNY			274.21B
07:00	CNY Imports (YoY) CNY			2.5%
07:00	CNY Trade Balance USD		$48.00B	$37.93B
07:00	CNY Exports (YoY) CNY			1.3%
07:00	CNY Exports (YoY)		3.0%	-1.3%
07:00	TRY Industrial Production (YoY)		6.2%	3.8%
07:00	RON Gross Domestic Product			3%
07:00	RON Consumer Price Index		3.7%	3.8%
08:00	HUF Industrial Output (YoY)			3.6%
08:00	HUF Consumer Price Index (YoY)		3.8%	3.4%
08:00	HUF Core Consumer Price Index (YoY)		4.1%	4.0%
08:00	EUR Headline Inflation (MoM)		0.2%	0.2%
08:00	EUR Core Inflation (MoM)		0.2%	0.2%
08:00	EUR Core Inflation (YoY)		2.7%	2.7%
08:00	EUR Headline Inflation (YoY)		3%	3%
n/a	EUR 6-Month Letras Auction			-0.448%
n/a	EUR 12-Month Letras Auction			-0.456%
11:00	USD NFIB Business Optimism Index		103.1	104.7
13:30	USD Consumer Price Index ex Food & Energy (MoM)		0.2%	0.2%
13:30	USD Consumer Price Index n.s.a (MoM)		257.220	257.208
13:30	USD Consumer Price Index ex Food & Energy (YoY)		2.3%	2.3%
13:30	USD Consumer Price Index (YoY)		2.0%	2.1%
13:30	USD Consumer Price Index (MoM)		0.2%	0.3%
13:30	USD Consumer Price Index Core s.a			265.62
13:55	USD Redbook Index (YoY)			7.2%
13:55	USD Redbook Index (MoM)			-2.6%
14:00	USD Fed's Williams speech
n/a	USD IBD/TIPP Economic Optimism (MoM)			57
19:00	USD Monthly Budget Statement		$-196.5B	$-209.0B
n/a	NZD REINZ House Price Index (MoM)			1.4%
21:00	KRW Import Price Growth (YoY)		-2.2%	-2.1%
21:00	KRW Export Price Growth (YoY)		-5.8%	-6.2%
21:30	USD API Weekly Crude Oil Stock			-5.945M
21:45	NZD Food Price Index (MoM)		0.0%	-0.7%
23:00	KRW Unemployment Rate		3.6%	3.6%
23:30	AUD Westpac Consumer Confidence			-1.9%
23:50	JPY Money Supply M2+CD (YoY)		2.9%	2.8%
Wednesday, Jan 15
00:04	IDR Exports		-1.18%	-5.67%
00:04	IDR Trade Balance		$-0.13B	$-1.33B
00:04	IDR Imports		-13.32%	-9.24%
00:30	JPY BoJ's Governor Kuroda speech
02:00	KRW Trade Balance			$2.02B
05:30	EUR Retail Sales (YoY)			5%
06:00	EUR Current Account			€0.5B
06:00	JPY Machine Tool Orders (YoY)			-37.9%
07:00	RON Industrial Production (MoM)			-2.1%
07:00	NOK Trade Balance			18.8B
07:45	EUR Consumer Price Index (EU norm) (MoM)		0.5%	0.5%
07:45	EUR Consumer Price Index (EU norm) (YoY)		1.6%	1.6%
07:45	EUR Inflation ex-tobacco (MoM)			-0.1%
08:00	TRY Budget Balance			7.8B
08:00	EUR HICP (MoM)		-0.1%	-0.1%
08:00	EUR HICP (YoY)		0.5%	0.8%
08:00	EUR Consumer Price Index (MoM)		0.2%	-0.1%
08:00	EUR Consumer Price Index (YoY)		0.4%	0.8%
08:30	SEK Consumer Price Index (MoM)		0.4%	0.1%
08:30	SEK Consumer Price Index (YoY)		1.8%	1.8%
08:40	GBP BoE's Saunders speech
09:00	EUR Real GDP Growth		0.6%	1.5%
09:30	GBP Retail Price Index (MoM)		0.3%	0.2%
09:30	GBP Retail Price Index (YoY)		2.3%	2.2%
09:30	GBP DCLG House Price Index (YoY)		1.2%	0.7%
09:30	GBP Producer Price Index - Output (MoM) n.s.a		0.0%	-0.2%
09:30	GBP PPI Core Output (MoM) n.s.a		0.0%	-0.1%
09:30	GBP Producer Price Index - Output (YoY) n.s.a		0.9%	0.5%
09:30	GBP Producer Price Index - Input (YoY) n.s.a		-0.7%	-2.7%
09:30	GBP PPI Core Output (YoY) n.s.a		1.0%	1.1%
09:30	GBP Producer Price Index - Input (MoM) n.s.a		0.3%	-0.3%
09:30	GBP Core Consumer Price Index (YoY)		1.6%	1.7%
09:30	GBP Consumer Price Index (YoY)		1.5%	1.5%
09:30	GBP Consumer Price Index (MoM)		0.2%	0.2%
10:00	EUR Trade Balance n.s.a.		€27.8B	€28.0B
10:00	EUR Trade Balance s.a.		€21.2B	€24.5B
10:00	EUR Industrial Production s.a. (MoM)		0.3%	-0.5%
10:00	EUR Industrial Production w.d.a. (YoY)		-1.2%	-2.2%
n/a	EUR 30-y Bond Auction			0.14%
11:00	ZAR Retail Sales (YoY)		0.6%	0.3%
11:00	ILS Consumer Price Index (MoM)			-0.4%
11:00	ILS Consumer Price Index (YoY)			0.3%
11:30	INR M3 Money Supply			10.4%
12:00	USD MBA Mortgage Applications			13.5%
12:00	BRL Retail Sales (MoM)			0.1%
13:30	USD NY Empire State Manufacturing Index		3.0	3.5
13:30	USD Producer Price Index (YoY)		1.2%	1.1%
13:30	USD Producer Price Index ex Food & Energy (MoM)		0.2%	-0.2%
13:30	USD Producer Price Index ex Food & Energy (YoY)		1.4%	1.3%
13:30	USD Producer Price Index (MoM)		0.2%	0.0%
15:30	USD EIA Crude Oil Stocks Change		-2.885M	1.164M
16:00	USD US-China Phase One Trade Deal Signature
16:00	USD Fed's Harker speech
18:00	EUR German Buba President Weidmann speech
19:00	USD Fed's Beige Book
19:00	ARS Consumer Price Index (MoM)			4.3%
21:45	NZD Electronic Card Retail Sales (MoM)		-0.2%	2.6%
21:45	NZD Electronic Card Retail Sales (YoY)		2.1%	5.1%
23:50	JPY Producer Price Index (YoY)		0.9%	0.1%
23:50	JPY Producer Price Index (MoM)		0.2%	0.2%
23:50	JPY Machinery Orders (MoM)		3.2%	-6.0%
23:50	JPY Machinery Orders (YoY)		-5.4%	-6.1%
Thursday, Jan 16
00:01	GBP RICS Housing Price Balance		-10%	-12%
00:30	AUD Home Loans		0.4%	0.6%
00:30	AUD Investment Lending for Homes			2%
01:30	CNY House Price Index			7.1%
03:00	KRW Money Supply Growth		7.4%	7.4%
05:30	EUR Unemployment Rate s.a (3M)			3.5%
07:00	EUR Consumer Price Index (YoY)		1.5%	1.5%
07:00	EUR Harmonized Index of Consumer Prices (YoY)		1.5%	1.5%
07:00	EUR Consumer Price Index (MoM)		0.5%	0.5%
07:00	EUR Harmonized Index of Consumer Prices (MoM)		0.6%	0.6%
08:00	CZK Producer Price Index (YoY)		1.0%	0.9%
08:00	CZK Producer Price Index (MoM)			-0.1%
09:30	GBP BoE Credit Conditions Survey
11:00	TRY CBRT Interest Rate Decision		12.5%	12.0%
11:00	EUR Consumer Price Index (MoM)			-0.1%
11:00	EUR HICP (YoY)			0.8%
11:00	EUR HICP (MoM)			-0.2%
11:00	EUR Consumer Price Index (YoY)			1.1%
11:00	ILS Gross Domestic Product (QoQ)			4%
12:30	EUR ECB Monetary Policy Meeting Accounts
13:00	PLN Net Inflation		3.2%	2.6%
n/a	RUB Central Bank Reserves $			$549.8B
13:30	USD Retail Sales ex Autos (MoM)			0.1%
13:30	USD Retail Sales Control Group		0.4%	0.1%
13:30	USD Retail Sales (MoM)		0.3%	0.2%
13:30	USD Initial Jobless Claims		220K	214K
13:30	USD Initial Jobless Claims 4-week average			224K
13:30	USD Continuing Jobless Claims		1.762M	1.803M
13:30	USD Import Price Index (YoY)		-1.2%	-1.3%
13:30	USD Import Price Index (MoM)		0.3%	0.2%
13:30	USD Export Price Index (YoY)		-0.8%	-1.3%
13:30	USD Export Price Index (MoM)		0.3%	0.2%
13:30	USD Philadelphia Fed Manufacturing Survey		3.9	0.3
14:00	ZAR SARB Interest Rate Decision		6.5%	6.5%
15:00	USD Business Inventories		-0.1%	0.2%
15:00	USD NAHB Housing Market Index		76	76
15:00	USD Fed's Bowman speech
15:30	USD EIA Natural Gas Storage Change		-51B	-44B
16:30	USD 4-Week Bill Auction			1.49%
17:00	EGP CBE Interest Rate Decision		12.25%	12.25%
21:00	USD Net Long-Term TIC Flows		$34.5B	$32.5B
21:00	USD Total Net TIC Flows		$51.7B	$-48.3B
21:30	NZD Business NZ PMI		50.6	51.4
23:50	JPY Foreign Bond Investment			¥-192.7B
23:50	JPY Foreign Investment in Japan Stocks			¥-80.8B
Friday, Jan 17
00:00	AUD HIA New Home Sales (MoM)		5.6%	-0.5%
01:00	KRW BoK Interest Rate Decision		1.25%	1.25%
02:00	CNY Retail Sales (YoY)		7.6%	8.0%
02:00	CNY Industrial Production (YoY)		5.9%	6.2%
02:00	CNY NBS Press Conference
02:00	CNY Fixed Asset Investment (YTD) (YoY)		5.2%	5.2%
02:00	CNY Gross Domestic Product (YoY)		6%	6%
02:00	CNY Gross Domestic Product (QoQ)		1.5%	1.5%
04:30	JPY Tertiary Industry Index (MoM)		3.9%	-4.6%
06:00	EUR Producer Price Index (YoY)			-0.8%
06:00	EUR Export Prices (YoY)			-1%
06:00	EUR Import Prices (YoY)			-0.5%
07:30	CHF Producer and Import Prices (MoM)		0.0%	-0.4%
07:30	CHF Producer and Import Prices (YoY)		-2.5%	-2.5%
07:45	EUR Budget			€-107.7B
08:00	EUR HICP (YoY)			1%
08:00	EUR HICP (MoM)			0.2%
08:00	EUR EU Norm Inflation (YoY)		3.2%	3.2%
08:00	EUR EU Norm Inflation (MoM)		0.2%	0.2%
09:00	EUR Global Trade Balance		€6.106B	€8.057B
09:00	EUR Trade Balance EU			€2.095B
09:00	EUR Current Account s.a		€25.6B	€32.4B
09:00	EUR Current Account n.s.a			€40.96B
09:30	GBP Retail Sales ex-Fuel (MoM)			-0.6%
09:30	GBP Retail Sales ex-Fuel (YoY)			0.8%
09:30	GBP Retail Sales (MoM)			-0.6%
09:30	GBP Retail Sales (YoY)			1%
10:00	EUR Consumer Price Index (YoY)			0.5%
10:00	EUR Consumer Price Index (EU Norm) (MoM)			0.2%
10:00	EUR Consumer Price Index (EU Norm) (YoY)		0.5%	0.5%
10:00	EUR Consumer Price Index (MoM)			0.2%
10:00	EUR Consumer Price Index (YoY)			1.3%
10:00	EUR Consumer Price Index - Core (MoM)		-0.5%	-0.5%
10:00	EUR Consumer Price Index (MoM)		-0.3%	-0.3%
10:00	EUR Consumer Price Index - Core (YoY)		1.3%	1.3%
10:00	EUR Construction Output s.a (MoM)			-1.01%
10:00	EUR Construction Output w.d.a (YoY)			0.3%
11:30	INR Bank Loan Growth			7.1%
11:30	INR FX Reserves, USD			$461.16B
13:30	USD Housing Starts (MoM)		1.365M	1.365M
13:30	USD Building Permits (MoM)		1.470M	1.482M
13:30	USD Building Permits Change			1.4%
13:30	USD Housing Starts Change			3.2%
13:30	CAD Foreign Portfolio Investment in Canadian Securities			$11.32B
13:30	CAD Canadian Portfolio Investment in Foreign Securities			$2.03B
14:00	USD Fed's Harker speech
14:00	RUB Foreign Trade			$12.423B
14:15	USD Industrial Production (MoM)		0.2%	1.1%
14:15	USD Capacity Utilization		77.4%	77.3%
15:00	USD JOLTS Job Openings		7.018M	7.267M
15:00	USD Michigan Consumer Sentiment Index		99.4	99.3
15:00	COP Retail Sales (YoY)		6.0%	7.4%
15:00	COP Industrial output (YoY)			2.1%
17:45	USD Fed's Bowman speech
18:00	USD Baker Hughes US Oil Rig Count			659
20:30	USD CFTC USD NC Net Positions			$40.8K
20:30	USD CFTC Gold NC Net Positions			$322.3K
20:30	USD CFTC Oil NC Net Positions			567.3K
20:30	GBP CFTC GBP NC Net Positions			£16.5K
20:30	JPY CFTC JPY NC Net Positions			¥-12.2K
20:30	EUR CFTC EUR NC Net Positions			€-61.7K
20:30	AUD CFTC AUD NC Net Positions			$-27.2K

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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