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Forex Today: Aussie – strongest amid Asia risk-on; UK GDP, Powell’s speech in spotlight

Dhwani Mehta FXStreet

The Asian equity markets tracked the record-run on Wall Street overnight while the sentiment remained upbeat amid fading China coronavirus fears and hopes of further fiscal and monetary stimulus from Beijing. A slowdown in new coronavirus cases and the factories resuming work in the world’s second-largest economy lifted the market mood.

Amongst the G10 currencies, the Australian dollar emerged as the strongest for the second straight session in Asia. The AUD/USD pair sustained the bounce above 0.6700, helped by stable Australian Business Conditions and risk-on. The safe-haven yen lost ground and sent USD/JPY closer to the 110 handle. The USD/JPY bulls cheered broad US dollar strength and gains in S&P 500 futures. Meanwhile, the traditional safe-haven, gold, snapped four-day winning streak and corrected below $1570.

The USD/CAD pair fell back below the 1.3300 level amid a risk-on rally in oil prices. The black jumped over 1% on short-covering. The EUR/USD pair meandered near a new four-month low reached in early trades at 1.0907 while the cable held on to the recovery mode above 1.2900 ahead of key event risks.

Main Topics in Asia

Coronavirus update: Death toll tops 1000

UK’s Javid to push for ‘permanent equivalence’ for City in Brexit talks – FT

US yield curve flirts with inversion on haven demand

US Pres. Trump: We should have a lower Fed rate right now

Australia: NAB business conditions weak but stable in January

White House: US Pres. Trump to visit India on Feb. 24-25 - Reuters

China’s HR Ministry: Overall jobs situation stable amid coronavirus outbreak

Coronavirus could trim 1 percentage point from China GDP growth – Govt think tank

Indonesia's Retail Sales drop 0.5% YoY in Dec, Rupiah keeps highs

UK shoppers still wary about spending in January - BRC

Officials: ECB review could be rushed to set an inflation goal by July – Bloomberg

Key Focus Ahead

Markets gear up for a busy economic calendar this Tuesday, as the UK Preliminary Q4 GDP and US Federal Reserve (Fed) Chairman Powell’s testimony will likely hog the limelight. The UK growth numbers are likely to hint towards a Bank of England (BOE) rate cut while investors will closely hear Powell’s take on the China coronavirus outbreak.

The UK data dump will drop in at 0930 GMT while at 1000 GMT, the European Commission will release its Economic Growth Forecasts.

The NA session lacks relevant macro data and therefore, the focus will remain on the European Central Bank (ECB) President Lagarde’s speech at 1400 GMT, which will be soon followed by Powell’s testimony before the Congress at 1500 GMT. The outgoing BOE Governor Carney’s address in the UK parliament will be also eyed at 1535 GMT.

Later in the American mid-morning, the speeches by BOE’s Haskel, Fed’s Quarles and Kashkari will also keep the traders busy amid incoming coronavirus updates.

EUR/USD: On a downward trajectory, Powell's testimony eyed

EUR/USD's recent slide from 1.1095 to 1.09 has put the bears in a commanding position. The pair formed a red "marubozu" candle last week, indicating a strong bearish sentiment. The focus will be on Fed Chairman Powell's take on coronavirus fallout.

GBP/USD: Modestly positive above 1.2900 ahead of UK GDP

GBP/USD holds the recovery above 1.2900 while heading into the London open. The UK data dump, Carney’s speech and Fed Chair Powell’s Testimony will be the key while coronavirus updates could keep filing the gaps.

UK GDP Preview: Stagnation may be good enough for pound bulls, three GBP/USD scenarios

Economists expect the UK to report stagnation in the fourth quarter of 2019. After several days under pressure, sterling may recover, especially if the economy ticks up. Outright recession risk may push the pound lower.

Federal Reserve Chairman Powell Testifies before Congress Preview: Pleased but wary

Federal Reserve Chairman Jerome Powell will testify before the House Committee on Financial Services in the Fed’s Semiannual Monetary Policy Report to Congress on Tuesday.

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GMT	Event	Actual	Consensus	Previous
Monday, Feb 10
24h	JPY National Foundation Day
16:30	USD 3-Month Bill Auction	1.55%		1.55%
16:30	USD 6-Month Bill Auction	1.51%		1.52%
20:15	USD Fed's Harker speech
Tuesday, Feb 11
00:01	GBP BRC Like-For-Like Retail Sales (YoY)	0.0%	-1.0%	1.7%
00:30	AUD National Australia Bank's Business Conditions	3	4	3
00:30	AUD National Australia Bank's Business Confidence	-1	0	-2
00:30	AUD Home Loans	3.5%	0.7%	-0.8% Revised from 1.8%
00:30	AUD Investment Lending for Homes	2.8%		2.5% Revised from 2.2%
03:00	IDR Retail Sales (YoY)	-0.5%		1.3%
06:00	JPY Machine Tool Orders (YoY)			-33.6%
n/a	CNY M2 Money Supply (YoY)		8.6%	8.7%
n/a	CNY New Loans		3,000B	1,140B
n/a	CNY FDI - Foreign Direct Investment (YTD) (YoY)			5.8%
09:30	ZAR Unemployment Rate (%)		29.1%	29.1%
09:30	ZAR Unemployment Total			6.7M
09:30	GBP Gross Domestic Product (YoY)		0.8%	1.1%
09:30	GBP Gross Domestic Product (QoQ)		0.0%	0.4%
09:30	GBP Manufacturing Production (YoY)		-1%	-2%
09:30	GBP Industrial Production (MoM)		0.3%	-1.2%
09:30	GBP Manufacturing Production (MoM)		0.5%	-1.7%
09:30	GBP Industrial Production (YoY)		-0.8%	-1.6%
09:30	GBP Total Business Investment (YoY)		-1.3%	0.5%
09:30	GBP Total Business Investment (QoQ)		-0.6%	0.0%
09:30	GBP Index of Services (3M/3M)		0.0%	0.1%
09:30	GBP Trade Balance; non-EU		£-2.584B	£1.734B
09:30	GBP Total Trade Balance			£4.031B
09:30	GBP Goods Trade Balance		£-10.000B	£-5.256B
09:30	GBP Gross Domestic Product (MoM)		0.2%	-0.3%
n/a	EUR 6-Month Letras Auction			-0.363%
n/a	EUR 12-Month Letras Auction			-0.405%
10:00	EUR European Commission releases Economic Growth Forecasts
11:00	USD NFIB Business Optimism Index		103.4	102.7
n/a	GBP NIESR GDP Estimate (3M)		0.2%	0.0%
n/a	ILS M1 Money Supply (MoM)			5.1%
12:00	MXN Industrial Output (YoY)		-1.8%	-2.1%
12:00	MXN Industrial Output (MoM)		-1.5%	0.8%
12:00	ZAR Manufacturing Production Index (YoY)		-3.45%	-3.60%
n/a	INR Trade Deficit Government		$11.58B	$11.25B
n/a	RUB Budget Fulfilment			1.8%
13:00	RUB Foreign Trade			$12.27B
13:55	USD Redbook Index (MoM)			0.2%
13:55	USD Redbook Index (YoY)			5.7%
15:00	USD JOLTS Job Openings		7.0M	6.8M
15:00	USD Fed's Chair Powell testifies
15:35	GBP Mark Carney speaks at UK Parliament
17:00	USD USDA WASDE Report
17:00	GBP BoE's Haskel speech
17:15	USD Fed's Quarles speech
18:00	USD 3-Year Note Auction			1.567%
19:15	USD Fed's Kashkari speech
n/a	NZD REINZ House Price Index (MoM)			0.5%
21:30	USD API Weekly Crude Oil Stock			4.18M
21:45	NZD Electronic Card Retail Sales (MoM)		1.0%	-0.8%
21:45	NZD Electronic Card Retail Sales (YoY)		3.2%	3.9%
23:00	KRW Unemployment Rate		3.6%	3.8%
23:30	AUD Westpac Consumer Confidence		1.4%	-1.8%
23:50	JPY Money Supply M2+CD (YoY)		2.6%	2.7%
Wednesday, Feb 12
01:00	NZD RBNZ Rate Statement
01:00	NZD RBNZ Interest Rate Decision		1%	1%
01:00	NZD Monetary Policy Statement
02:00	NZD RBNZ Press Conference
05:00	SGD Retail Sales (MoM)		0.0%	0.2%
05:00	SGD Retail Sales (YoY)		1.1%	-4.0%
05:30	EUR Consumer Price Index n.s.a (YoY)			2.7%
07:00	RON Industrial Production (MoM)			-0.2%
08:00	HUF Industrial Output (YoY)			-1.2%
08:30	SEK Riksbank Interest Rate Decision		0%	0%
10:00	EUR Industrial Production s.a. (MoM)		-1.6%	0.2%
10:00	EUR Industrial Production w.d.a. (YoY)		-2.3%	-1.5%
n/a	EUR 10-y Bond Auction			-0.25%
11:00	ZAR Retail Sales (YoY)		1.5%	2.6%
11:00	EUR Consumer Price Index (YoY)			0.8%
11:00	EUR Consumer Price Index (MoM)			-0.9%
11:00	ILS Exports			$4,070.6M
11:00	ILS Imports			$7,109.9M
11:00	ILS Trade Balance			$-3,039.3M
11:30	INR M3 Money Supply			9.9%
12:00	USD MBA Mortgage Applications			5%
12:00	BRL Retail Sales (MoM)		1.1%	0.6%
12:00	INR Cumulative Industrial Output			0.6%
12:00	INR Manufacturing Output			2.7%
12:00	INR Industrial Output		1.8%	1.8%
13:30	USD Fed's Harker speech
15:00	USD Fed's Chair Powell testifies
15:30	USD EIA Crude Oil Stocks Change			3.355M
n/a	GBP Autumn Forecast Statement
18:00	USD 10-Year Note Auction			1.869%
19:00	USD Monthly Budget Statement		$14.7B	$-13.3B
19:10	NZD RBNZ's Governor Orr speech
23:50	JPY Producer Price Index (MoM)		0.0%	0.1%
23:50	JPY Producer Price Index (YoY)		1.5%	0.9%
Thursday, Feb 13
00:00	AUD Consumer Inflation Expectations		4.3%	4.7%
00:01	GBP RICS Housing Price Balance		3%	-2%
00:15	CAD BoC's Governor Poloz speech
00:15	AUD RBA's Governor Lowe speech
05:30	EUR Retail Sales (YoY)			3.3%
06:00	EUR Current Account			€0.2B
06:30	EUR ILO Unemployment		8.5%	8.6%
07:00	EUR Consumer Price Index (YoY)		1.7%	1.7%
07:00	EUR Harmonized Index of Consumer Prices (YoY)		1.6%	1.6%
07:00	EUR Consumer Price Index (MoM)		-0.6%	-0.6%
07:00	EUR Harmonized Index of Consumer Prices (MoM)		-0.8%	-0.8%
07:00	TRY Industrial Production (YoY)		7.0%	5.1%
07:00	RON Consumer Price Index		3.9%	4.0%
08:00	HUF Core Consumer Price Index (YoY)		4.0%	3.9%
08:00	HUF Consumer Price Index (YoY)		4.3%	4.0%
08:30	EUR Gross Domestic Product s.a (QoQ)		0.3%	0.4%
08:30	EUR Gross Domestic Product n.s.a (YoY)		1.7%	1.9%
09:00	PLN Gross Domestic Product Qtr (YoY)			3.9%
09:00	CZK Current Account (MoM)		-8.00B	-3.19B
13:00	PLN Current Account			€1,457M
13:00	RUB Central Bank Reserves $			$562.3B
13:30	USD Continuing Jobless Claims		1.745M	1.751M
13:30	USD Initial Jobless Claims		210K	202K
13:30	USD Initial Jobless Claims 4-week average			211.75K
13:30	USD Consumer Price Index (YoY)		2.4%	2.3%
13:30	USD Consumer Price Index ex Food & Energy (YoY)		2.2%	2.3%
13:30	USD Consumer Price Index ex Food & Energy (MoM)		0.2%	0.1%
13:30	USD Consumer Price Index n.s.a (MoM)		257.863	256.974
13:30	USD Consumer Price Index (MoM)		0.2%	0.2%
13:30	USD Consumer Price Index Core s.a		266.398	265.921
15:00	COP Retail Sales (YoY)			4.4%
15:00	COP Industrial output (YoY)			-1.5%
15:30	USD EIA Natural Gas Storage Change			-137B
16:30	USD 4-Week Bill Auction			1.54%
18:00	USD 30-Year Bond Auction			2.341%
19:00	MXN Central Bank Interest Rate			7.25%
19:00	ARS Consumer Price Index (MoM)		3.3%	3.7%
21:00	KRW Export Price Growth (YoY)		-1.5%	-3.1%
21:00	KRW Import Price Growth (YoY)		2.6%	3.4%
21:30	NZD Business NZ PMI		51.0	49.3
21:45	NZD Food Price Index (MoM)		0.2%	-0.2%
23:50	JPY Foreign Bond Investment			¥-150.2B
23:50	JPY Foreign Investment in Japan Stocks			¥-295.6B
Friday, Feb 14
02:00	CNY Retail Sales (YoY)			8%
02:00	CNY Industrial Production (YoY)			6.9%
02:00	CNY NBS Press Conference
02:00	CNY Fixed Asset Investment (YTD) (YoY)			5.4%
02:00	KRW Trade Balance			$0.62B
03:00	KRW Money Supply Growth		7.8%	8.1%
04:30	JPY Tertiary Industry Index (MoM)		-1.6%	1.3%
06:00	EUR Gross Domestic Product (YoY)			2.3%
06:30	INR WPI Inflation		2.92%	2.59%
07:00	EUR Gross Domestic Product (QoQ)		0.1%	0.1%
07:00	EUR Gross Domestic Product w.d.a (YoY)		0.4%	0.5%
07:00	EUR Gross Domestic Product (YoY)		0.2%	1.0%
07:00	TRY Current Account Balance		$-0.420B	$-0.518B
07:00	DKK Gross Domestic Product (QoQ)			0.4%
07:00	RON Gross Domestic Product		3.3%	3.0%
07:30	CHF Producer and Import Prices (YoY)		-1.5%	-1.7%
07:30	CHF Producer and Import Prices (MoM)		0.0%	0.1%
08:00	EUR HICP (MoM)		-1.4%	-1.4%
08:00	EUR HICP (YoY)		1.1%	1.1%
08:00	EUR Consumer Price Index (YoY)		1.1%	1.1%
08:00	EUR Consumer Price Index (MoM)		-1%	-1%
08:00	HUF Gross Domestic Product (YoY)		4.5%	5.0%
08:00	CZK Consumer Price Index (YoY)			3.2%
08:00	CZK Consumer Price Index (MoM)			0.2%
08:00	CZK Producer Price Index (YoY)			2.1%
08:00	CZK Producer Price Index (MoM)			0.1%
08:00	CZK Gross Domestic Product (YoY)		2.7%	2.5%
08:00	EUR Gross Domestic Product Prelim (YoY)			1.3%
08:00	EUR EU Norm Inflation (MoM)			-0.1%
08:00	EUR EU Norm Inflation (YoY)			3.2%
08:30	EUR Gross Domestic Product (QoQ)			0.3%
09:00	EUR Global Trade Balance		€4.946B	€4.872B
09:00	EUR Trade Balance EU			€0.702B
09:00	PLN Consumer Price Index (MoM)		0.4%	0.8%
09:00	PLN Consumer Price Index (YoY)		2.9%	3.4%
09:30	EUR Gross Domestic Product (YoY)			1.9%
10:00	EUR Consumer Price Index (YoY)		0.7%	0.8%
10:00	EUR Consumer Price Index - Harmonized (YoY)		0.7%	1.1%
10:00	JPY BoJ's Amamiya speech
10:00	EUR Trade Balance s.a.		€21.6B	€19.2B
10:00	EUR Trade Balance n.s.a.		€21.4B	€20.7B
10:00	EUR Gross Domestic Product s.a. (QoQ)		0.1%	0.1%
10:00	EUR Gross Domestic Product s.a. (YoY)		1%	1%
10:00	EUR Employment Change (QoQ)		0.1%	0.1%
10:00	EUR Employment Change (YoY)		0.8%	0.9%
11:00	ILS Consumer Price Index (YoY)		0.7%	0.6%
11:00	ILS Consumer Price Index (MoM)			0%
11:30	INR Bank Loan Growth		6.7%	7.2%
11:30	INR FX Reserves, USD			$471.3B
13:30	USD Retail Sales ex Autos (MoM)		0.3%	0.7%
13:30	USD Retail Sales Control Group		0.3%	0.5%
13:30	USD Retail Sales (MoM)		0.3%	0.3%
13:30	USD Export Price Index (YoY)		-0.4%	-0.7%
13:30	USD Import Price Index (MoM)		-0.2%	0.3%
13:30	USD Import Price Index (YoY)		2.5%	0.5%
13:30	USD Export Price Index (MoM)		-0.1%	-0.2%
14:15	USD Industrial Production (MoM)		-0.2%	-0.3%
14:15	USD Capacity Utilization		76.8%	77.0%
15:00	USD Michigan Consumer Sentiment Index		99.5	99.8
15:00	USD Business Inventories		0.1%	-0.2%
16:00	COP Gross Domestic Product (YoY)			3.3%
18:00	USD Baker Hughes US Oil Rig Count			676
20:30	USD CFTC Gold NC Net Positions			$299.8K
20:30	USD CFTC Oil NC Net Positions			397.4K
20:30	USD CFTC USD NC Net Positions			$46.1K
20:30	GBP CFTC GBP NC Net Positions			£13K
20:30	JPY CFTC JPY NC Net Positions			¥-21.9K
20:30	EUR CFTC EUR NC Net Positions			€-75.1K
20:30	AUD CFTC AUD NC Net Positions			$-43.3K

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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