Forex today was dominated yet again by price action in the pound and headlines surrounding the BoE, UK economy and politics.
GBP was two-way business after remarks o/n from Bank of England Chief Economist Andy Haldane when he said that he was close to voting for a rate hike last month. This was in stark contrast to Carney's recent comments when he told markets that rates are on hold for the foreseeable future.
In the US session, there was a subdued tone with the markets, rates and dollar all struggling with a drop in oil prices once again -This lead to the energy and bank sectors heading lower as well a with a sharp break in the commodity index also.
The DXY continues to build a base but was down -0.215 at the time of writing at 97.55 having traded between a range 97.51-97.80. The 10-year yields were flat but trading in a range between 2.1425 and 2.1756%.
The euro was going nowhere on the 1.11 handle again but remains vulnerable to the differential in yields with the German yield curve ticking lower. Cable rallied and ended higher than yesterday's close, although not as high as the 1.2710 level reached o/n on the Haldane contradiction. USD/JPY ticked lower on the 111 handle but supported at 111.07 low from 111.73 highs starting in European trade. Commodity bloc currencies were lower on oil, AUD supported 0.7543, NZD 0.7206 and CAD 1.3348 vs the greenback as a low, (USD/CAD's high). WTI dropped to $41.83. Gold pressured and also fell to $1,240 the low falling $7.00.
The day ahead:
RBNZ: When is the RBNZ and how could it affect NZD/USD?
Key notes from US session:
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