FX News Today
European stock markets are heading lower again at the start of the European trading day, following on from losses on most Asian markets outside of China which managed to move higher as officials weakened the Yuan. China’s CAIXIN Services PMI fell to 17-month low of 50.2 in December. The data clearly adds to concerns about the health of the world’s second largest economy.
The EUR continues to weaken after Eurozone National PMIs mixed, with the German services reading revised up to 56.0 from 55.4 reported initially and versus 55.6 in November. The Italian reading, released for the first time, also came in higher than expected and jumped to 55.3 from 53.4. The French reading meanwhile was revised down to 49.8 from 50.0, which means the sector is back in contraction territory. The Spanish services PMI also came in much weaker than anticipated and fell to 55.1 from 56.7, although this is still a very high reading, indicating ongoing robust growth.
Crude Oil trades lower near $35.50 at the time of writing, after ranging between $37.10 and $36.46 overnight. Monday’s rally to near one month highs near $38.40 was short-lived, and since then has traded lower by the ongoing story of global oversupply.
The JPY has been over preforming against the majors, with USDJPY trading to fresh near three-month lows and EURJPY extending deeper into near eight-month low territory.
The commodity currencies (AUD and CAD) continue to underperform, with most commodities and stock markets in Asia mostly trading lower.
Main Macro Events Today
• USD U.S. Trade Deficit: November trade data is out today and should reveal a $43.3 bln (median -$44.2 bln) deficit for the month which would represent a narrowing over the $43.9 bln deficit reported in October. Analyst expect exports and imports to both decline by 1.1% for the month compared to respective October figures which showed a 1.4% decline for exports and a 0.6% decline for imports.
• USD U.S. Factory Goods: November factory goods data is out today and should show orders unchanged (median -0.2%) with inventories down 0.2% and sales up 0.5% for the month. This would follow respective October figures of 1.4% for orders, -0.1% for inventories and -0.6% for shipments. The durable goods data for the month had orders unchanged, inventories down 0.3% and sales up 0.9%. Data in line with forecast would leave the I/S ratio steady at 1.35 for a fourth month.
• USD U.S. Non-Manufacturing ISM: The December service sector ISM is out later today and should tick up to 56.0 (median 56.0) from 55.9 in November. The December ISM declined to 48.2 from 48.6 but strength in component data from other measures of sentiment have led us to expect an improvement in December with the broad ISM adjusted average climbing to 51 after holding at 50 since September.
• USD FOMC Minutes: The December meeting minutes will be scrutinized for clues on the rate trajectory, even though officials have said increases will be gradual, but also data dependent. The initial liftoff, however, seemed to be more of a case that rates have been too low for too long, and not an overheating economy or rising prices. Meanwhile, the Fed’s dot-plot suggest there will be 4 increases this year.
Janne Muta
Chief Market Analyst
If you wish to get the latest forex brokers news,you can visit our Top Forex Brokers official website:
http://www.topforexbrokerscomparison.com
About Janne Muta, HotForex’s Chief Market Analyst
Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.
Traders and fund managers from around the world have benefited greatly from Janne’s technical analysis methods. The indicators and price action based trading models he has developed, have, after rigorous testing, proven to be invaluable in identifying high probability trades.
“My mission is to help you to become a confident and successful trader”
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.