Forex today was a quiet affair in Asia, with most majors sticking to tight ranges, consolidating yesterday rebound amid broad-based US dollar sell-off. The EUR/USD pair extended its previous rally and hit weekly tops above 1.2060 levels, as hawkish ECB minutes continued to underpin. Meanwhile, the Antipodeans showed a limited reaction to the upbeat Chinese trade report while the USD/JPY pair managed to keep the 111 handle amid mixed Asian equities and dismal Japanese current account data.
Main topics in Asia
Bloomberg news foreign policy reporter Nicholas Wadhams latest tweet reads as follows-
China's trade balance for December, in Yuan terms, came in at CNY +362 bn vs +235.2 bn expected and +263.6 bn last.
The China customs published trade balance for Dec in USD terms, reporting a big beat on expectations in the trade surplus.
Following the latest update on cryptocurrencies, the South Korean Finance Minister Kim Dong-yeon was on the wires, via Yonhap, citing..
Key Focus ahead
There are no relevant macro data due to be reported in the European session, as the dust settles over the hawkish ECB minutes aftermath. The main market moving events for today remain the US CPI and retail sales that will be reported at 1330 GMT, followed by the releases of a couple of minority reports.
Amongst central bankers’ speeches, German Bundesbank President Weidmann and FOMC member Rosengren will be up on the rostrum in the NA session. Also, in focus will be the US rigs count data for fresh impetus on oil prices and the CAD.
The common currency continues to defy gravity in Asia, as the ECB December meeting minutes released yesterday called for a gradual adjustment in the forward guidance to better reflect the improved growth prospects.
The GBP/USD pair extended its rebound from eight-day troughs and went to hit fresh three-day highs at 1.3565 in the Asian trades, before easing back near the midpoint of the 1.35 handle.
Brent oil hit $70 a barrel for the first time since December 2014. Will it have a positive impact on gold? As per textbook rules, oil price rally boosts inflation expectations, thus leading to higher demand for gold (inflation hedge).
Analysts at Westpac are out with a brief preview of the key macro events due on the cards from the US docket later today at 1330 GMT.
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