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By XE Market Analysis January 15, 2019 3:15 pm
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    XE Market Analysis: Asia - Jan 15, 2019

    The Dollar moved higher in N.Y. on Tuesday, despite the cooler U.S. PPI outcome. Wall Street rallied, which saw Treasury yields rise some, supportive of the Greenback. EUR-USD fell from 1.1455 highs to a 1.1381 low, while USD-JPY bottomed at 108.33 then bounced to 108.76 as stocks headed higher. USD-CAD topped at 1.3295 from 1.3224 lows. Cable popped up to 1.2800 as the Brexit vote failed, after bottoming at 1.2795.

    [EUR, USD]
    EUR-USD fell to levels last seen on January 4, bottoming at 1.1384, and down from 1.1455 highs seen at mid-morning. Weak incoming EU data has been a main driver of Euro weakness of late, with the latest being a slowdown in Germany's 2018 GDP. The ECB's Draghi said in Strasbourg "recent economic developments are weaker than expected," and a continuation of the softer path will likely see EUR-USD remain under pressure, even with the threat of slowing in the U.S. given the current government shut down. Next EUR-USD support comes at 1.1345, the January 4 low.

    [USD, JPY]
    USD-JPY fell from opening highs of 108.58 after the cooler PPI data, bottoming at 108.33 before climbing back to 108.75 again. Wall Street's rally has helped the pairing higher, and the next upside target will be the overnight five-session high of 108.76.

    [GBP, USD]
    Cable came under some pressure ahead of the Brexit vote, bottoming in N.Y. at 1.2695. The U.K. Parliament later rejected the Brexit/EU deal soundly, with the tally 432-202 against approving the measure. Sterling had been on the decline through the session, though has since bounced in a relief rally. Cable advanced to the 1.2800 level.

    [USD, CHF]
    EUR-CHF was range bound, finding support into 1.1250. The cross had last week punched out a four-month low at 1.1184, which was seen as the Swiss franc picked up safe haven demand in the wake of Apple's revenue warning (which in turn followed December manufacturing PMI data showing weakening across key global economies). The SNB remained firmly on hold at its quarterly policy meeting last month, continuing to rely on the combination of negative interest rates and the threat of intervention to limit appreciation in the currency in times of heightened uncertainty about the global outlook.

    [USD, CAD]
    USD-CAD dipped to session lows of 1.3241, coming from near 1.3280 after Monday's close. WTI crude printed session highs of $51.71, while the risk backdrop has improved, keeping a top on USD-CAD through the morning session. A generally firmer USD tone later in the day saw the pairing rally to 1.3295 highs.

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