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Thanks to the Christmas holiday falling mid-week, we really only have economic data for about three and a half days. Let’s start with the news out of Japan. First, CPI increased 1.5% YOY, a further acceleration of this statistics (which increased 1.1% in the previous YOY reading). Read more
The dollar rebounded from its overnight losses, unwinding most of the damage done in London. Trade was very thin, and it didn't take much volume to push EUR-USD back under 1.3770, after it peaked over 1.3890 into the N.Y. open. USD-JPY traded over 105.00, though struggled some over thee figure, while USD-CAD moved over 1.0700 on U.S. Read more
EUR-USD spiked sharply from the low 1.37s to 15-month highs near 1.3850, having breached the December high of 1.3812 on route. There didn't appear any specific news or data developments behind the move other than reports of an Asian central bank on the bid in EUR-USD, which has had a magnified impact due to the year-end market conditions. Read more
USD-JPY lifted above 105.00 for the first time since 2008, leaving a high of 105.03 before retreating to the 104.70 area following the Tokyo fix. EUR-JPY was a driver during the US-JPY ascent, and the cross also logged a new five-year peak of 144.21, as did GBP-JPY. Read more
The dollar drifted slightly higher, largely on vaporous volumes. EUR-USD shied away from the 1.3700 level, with standing offers noted at the figure and above. This said, the lack of interest overall should see downside limited to at most 1.3670 near term. Read more
Once of the long leading indicators for the US economy that I track is the real personal savings rate. This is the percent of income which is being saved, minus the YoY inflation rate. It serves as a measure of how much or how little people think they need to save vs. Read more
Given the BOJ's current stance of monetary loosening, any analysis involving the yen is fairly straightforward. The analysis verses the dollar is that much easier as the Fed has recently announced it will slowly end its quantitative easing program, which is dollar positive. Read more
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FX trade was nearly non-existent overnight, with most of Europe out for Boxing Day holidays. EUR-USD moved briefly over 1.3700, though has since drifted in the 1.3790s. USD-JPY meanwhile, was flat-lined near 104.75. The only U.S. data release this morning will be weekly jobless claims at 8:30 EST, where we expected a 340k outcome. Read more
FX trade was very quiet on Christmas eve in N.Y., with major dollar pairings holding inside of very tight ranges. Stronger durable goods orders, firmer housing prices, and improved new home sales helped sentiment, resulting in a firmer dollar, and yet another modest Wall Street rally. Read more
Above is a chart of the EUR/USD. Prices have broken the trend line connecting the lows of 11/20, 12/2 and 12/17. The candle leading to the 12/18 trend break was very strong, indicating downward momentum existed. Since the trend break, prices have moved higher, but the previous support line has become resistance -- as have the 10 and 20 day EMAs. Pulling the lens back a bit, we see a euro rally that started in early July and continued until recently. Read more
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