Italy continues to pull the EUR around by the nose ring - Scotiabank

Ross J Burland FXStreet

Analysts at Scotiabank explained that Italy continues to pull the EUR around by the nose ring.

Key Quotes:

"Senior politicians have tried to dampen the impact of EUR-negative comments today specifically, Rome’s clash with Brussels on fiscal policy – and the consequences of these policy decisions for Italy’s sovereign ratings remains a threat for markets."

"While we remain bearish on the outlook for the USD, we recognise that still widening Eurozone-US interest rate differentials (2-year spreads now at -336bps) is a severe impediment to the EUR rallying at this point. The only wonder is perhaps why the EUR is not already a lot lower against the spread backdrop."

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD edges higher as hot CPI inflation and hawkish RBA lift rate hike bets

The AUD/USD pair gathers strength to near 0.7035 during the Asian trading hours on Friday. The Australian Dollar edges higher against the US Dollar as hotter Australian CPI inflation data has bolstered expectations of Reserve Bank of Australia rate hikes.

USD/JPY weakens below 157.50 after BoJ keeps rates unchanged

USD/JPY drifts lower for the third straight day, sliding below mid-157.00s during Friday’s Asian session after the widely expected BoJ on-hold rate decision. Meanwhile, the US Dollar selling remains unabated amid hopes for Middle East diplomacy. Moreover, declining US bond yields narrow the US-Japan yield differential, benefiting the Japanese Yen and weighing on the currency pair.

Gold falls below $4,000 as strong US data strengthen case for Fed rate hike

Gold extends its decline below the psychological level of $4,000 while entering into the weekend. The precious metal faces selling pressure as better-than-projected United States preliminary Q3 Gross Domestic Product and hot Personal Consumption Expenditure Price Index data for September have strengthen the case for an interest rate hike by the Federal Reserve in the December policy meeting.

The hawkish Fed can't lift the US Dollar anymore

About three more Federal Reserve hikes are already priced in, and the central banks behind the Euro, Pound, Yen and Loonie are raising rates or about to. That leaves the US Dollar Index with little to gain if the Fed keeps leaning toward higher rates.

Binance hack puts crypto exchange custody risk back in focus

Binance is investigating a major security incident after billions of dollars in crypto assets moved from wallets associated with the exchange. The final scale of the incident remains unclear.

A hot US economy is supposed to sink Gold. It didn't. Here's why

Gold (XAU/USD) remains under pressure near $4,000, as stronger-than-expected United States (US) economic data reinforce expectations of another Federal Reserve (Fed) interest rate hike in December. Economic growth is accelerating, inflation remains elevated, and borrowing costs could rise further.