Forex today: Dollar mixed but commodity complex beaten up; AUD/USD extended its multi-day decline to 0.7192

• Forex today was wearing a downtrodden risk sentiment and a bloodbath.
• AUD/USD extended its multi-day decline to 0.7192 after the speech and as European equity markets tumbled but was then able to edge back to 0.7225.

Forex today was wearing a downtrodden risk sentiment and a bloodbath on Wall Street that continued with the European theme where shares were down 3.2-5.3% and having their worst day since Brexit in 2016 - The cause? Take your pick, but in the main, Sino/USD relations breaking down no more than just a few days since a loose band-aid had been applied to the volatile relationship following a rather ambiguous handshake ceasefire agreement between at the G20. The news that Canada arrested the CFO of Huawei Technologies, who now faces extradition to the US over possible violations of sanctions against Iran, has encouraged a response from Beijing which was the main catalyst. 

China is requesting that both Canada and the US to "rectify wrongdoing". 

The indexes on Wall Street managed to claw their way back from some of the worst levels for Thursday, but the DJIA had, at one stage, lost 785 points at its worst levels and the S&P 500 dropped 0.17% to 2,695.95.

Meanwhile, the first day of the OPEC meeting added to the volatility with wild price swings in the black gold. Brent crude, the world's barometer for energy prices, was down by as much as 5% at one point. We will now wait for the cartel and non-OPEC oil producers to meet today (Friday) to see if a deal can be struck to cut production to prevent the glut and prices dropping even further - $45bbls is on the cards otherwise. 

Eyes will also turn to the nonfarm payrolls event for Friday, although today's ADP Research Institute’s private payrolls report was on the soft side and showed a 179k gain in November, slightly shy of expectations of 195k. That report is not necessarily a prelude to the government report but it has left a dark spot over the sector leading in. 

However, the US services ISM survey rose back toward near record levels in November, hitting 60.7 from 60.3 last month, but the trade deficit widened to its largest levels in 10 years (-$55.5bn) with the politically delicate deficit with China hitting a record high of -$43.1bn, while durable goods orders for October were revised down to show a steeper -4.3% de

In all of that, US yields were down as much as 10bps overnight, but have come off the lows with the 2-year yield down 5bps to 2.75% and the 10-year down 4bps to 2.87%. The USD was mixed but kept its form vs the commodity complex. 

Analysts at Westpac gave their recap of the action in the currencies:

"EUR/USD rose from 1.1320 to 1.1415 then steadied around 1.1380."

" GBP/USD rose 0.5c to 1.2800 as Brexit headlines swirled, including some about a second referendum."

"USD/JPY fell from 113.20 to 112.25, the defensive yen the best performer on the day."

RBA deputy governor Debelle spoke on the lessons of the global crisis but took questions on the near term outlook. He reiterated that the next move on rates was still likely to be up but showed concern about tighter credit standards and said that interest rates “can still move lower.”

"USD/CNH rose 0.4% to 6.89."

"AUD/USD extended its multi-day decline to 0.7192 after the speech and as European equity markets tumbled but was then able to edge back to 0.7225."

"NZD/USD is net -25 pips over the day at 0.6870. AUD/NZD fell further to 1.0476 – the lowest since July 2017 – but then pushed back above 1.05."

Key notes in US session:

Wall Street benchmarks recover from worst levels, but end in a sea of red

Key events ahead:

The US November employment report dominates the global calendar and the analysts at Westpac note that the median forecast for non-farm payrolls on Bloomberg is 198k, after the rapid 250k in Oct. "The unemployment rate is seen holding at 3.7% while average hourly earnings are seen up 0.3%mth, which would keep the annual rate at 3.1%, equalling the high since 2009."