Forex Today: Aussie weakest in Asia risk-off, eyes on BOE inflation report hearings


Forex today in Asia witnessed risk-off market profile for the second day in a row this Monday, as the Asian stocks tracked the heavy losses in their Wall Street counterparts. Amid risk-aversion, the Aussie was the biggest loser while the Yen recovered ground and dragged the USD/JPY pair back to the 112.50 level. The Aussie faced rejected at 0.7300 and from there dropped sharply to 0.7270 following the IMF warnings on the Australian economy. The rest of the majors stuck to tight trading ranges amid a broadly subdued US dollar while markets await fresh updates around the European politics for further trading impetus.

Both crude benchmarks traded on the back foot ahead of the OPEC-Joint Ministerial Monitoring Committee (JMMC) meetings while gold prices on Comex remains stuck below the 1225 level amid slightly higher Treasury yields.  

Main Topics in Asia

Northern Irish DUP party fires warning shot at UK PM May - Reuters

Japan's Aso: PM has ordered supplementary budget

RBA November meeting minutes: No strong case for a near term move

BoJ’s Kuroda: Chance of hitting inflation target in FY2020 is low

Trump Administration considering adding Venezuela to US list of state sponsors of terrorism

N. Korea urges Japan to withdraw support for US-led sanctions - Yonhap

Gold: 100-day EMA is proving a tough nut to crack for third straight day

Mexico expects US to begin lifting tariffs with USMCA deal signing´

Asian stocks are a sea of red, the Shanghai Composite is trapping bulls no wrong side of the market

Key Focus Ahead

The EUR economic calendar remains data-light for the second straight day this week, with the second-liner German producer price index data slated for release at 0700 GMT alongside the release of the Swiss trade numbers. At 0820 GMT, the RBA Governor Lowe’s speech will be published, as he is due to deliver a speech titled "Trust and Prosperity" at the Committee for Economic Development of Australia Annual Dinner, in Melbourne.

The main focus in Europe will be on the Bank of England (BOE) inflation report hearings due at 1000 GMT when the BOE Governor Carney will testify before the Parliamentary Treasury Select Committee (TSC) along with MPC's Haldane, Cuncliffe and Saunders. Markets will watch out for fresh take of the central bank on the latest Brexit developments. Meanwhile, the Brexit-related headlines will continue to drive the sentiment across the fx board.

In the NA session, the US housing starts and building permits data will be reported at 1330 GMT, followed by New Zealand’s GDT price index around 1400 GMT. At 1500 GMT, we have the ECB Vice-President Weidmann speaking at the European Insurance and Occupational Pensions Authority Conference, in Frankfurt. Also, of note remains the speeches by the BOC Governing Council members Wilkins and Lane that are due at 1800 GMT and 2200 GMT respectively. The US API fuel stocks data will be published at 2130 GMT.

It’s also worth noting that the OPEC-Joint Ministerial Monitoring Committee (JMMC) meetings are scheduled later on Tuesday, which will have a major bearing on the oil market.

EUR/USD: Upside gathering steam as yield differentials roll over in favor of the EUR

The EUR/USD is looking north amid risk aversion in the financial markets. The EUR's resilience to the risk aversion could be associated with a decline in the US-German yield differential. 

GBP/USD: Brexit on the backburner once more as UK Inflation Hearings back for another round

On the economic calendar for Tuesday, the Bank of England's (BoE) Governor Mark Carney will be delivering his testimony in the British parliament for the latest Inflation Report Hearings …

EUR weakness is coming to an end – Commerzbank

Analysts at Commerzbank offer their view on the Euro in the coming months, in the wake of the Italian political risks.

These currencies have a history of Thanksgiving breakouts

Fundamentally, there's not much on the US calendar this week and it seems like any weakness in second-tier reports is being used as an excuse to continue selling dollars. 

Will Goldilocks Inflation Stay in 2019?

Inflation has reached a Goldilocks state as far as the Fed is concerned. Yet could the Goldilocks scenario change and cause the Fed to either quicken its pace of policy tightening or ease up on the brakes?

GMT
Event
Vol.
Actual
Consensus
Previous
Monday, Nov 19
24h
 
 
Tuesday, Nov 20
24h
 
 
07:00
 
0.3%
0.5%
07:00
 
3.3%
3.2%
07:00
 
 
17,682M
07:00
 
2,890M
2,434M
07:00
 
 
15,248M
08:20
 
 
10:00
 
 
10:00
 
 
11:00
 
-7
-6
13:30
 
 
-0.6%
13:30
 
1.225M
1.201M
13:30
 
1.267M
1.241M
13:30
 
 
-5.3%
13:55
 
 
6.1%
13:55
 
 
0.2%
n/a
 
 
-2%
15:00
 
 
16:30
 
 
2.2%
18:00
 
 
21:30
 
 
8.79M
22:00
 
 
23:30
 
 
-0.1%
Wednesday, Nov 21
n/a
 
 
02:00
 
 
7.8%
04:30
 
-0.8%
0.5%

 

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