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By XE Market Analysis November 24, 2017 1:06 pm
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    XE Market Analysis: Asia - Nov 24, 2017

    FX trade was relatively quiet in N.Y. on Fridahy, with many traders remaining on holiday following Thursday's Thanksgiving Day. The greenback was mostly lower however, pushing the DXY to a two-month base of 92.68. EUR-USD vaulted to 1.1944 highs, while cable touched seven-week highs of 1.2259. USD-CAD reversed lower ras oil prices remained firm, while USD-JPY bucked the trend, rising over 111.55 on delayed reaction to the BoJ cutting back its bond purchase program.

    [EUR, USD]
    EUR-USD has advanced to two-month highs of 1.1944, reportedly tripping buy-stops over the 1.1900 mark. The euro has been supported by solid incoming EU PMI data seen on Thursday, along with better German Ifo figures this morning. Broad dollar weakness has been a driver as well, with the DXY falling to 92.68 lows, levels last seen on September 26.

    [USD, JPY]
    USD-JPY has bucked the trend to a degree in N.Y. morning trade, climbing to highs of 111.58 from opening lows of 111.30. The BoJ announcement that it was reducing the size of its JGB purchases by Y10 bln appears to have sunk in, after the yen showed little reaction to the news. The BoJ action brings credence to a Reuters report earlier ins week, which said that central bank policymakers are starting to shift out of an ultra-dovish mindset.

    [GBP, USD]
    Cable clocked a seven-week high at 1.3359, and the pound has more than managed to recoup the ground lost to the euro and yen this week, presently showing an average 0.4% gain versus the G3 currencies. Sterling has been broadly holding its own versus the major currencies over the last month or two, and we expect this to remain the case for now, though we still see the balance of risks being skewed to the downside given the risk of Brexit-related disappointment into the EU leaders' summit in December.

    [USD, CHF]
    EUR-CHF rallied to 1.1698 after having recouped from Monday's swift dive to a 1.1591 low, seen as markets reacted to the news that talks to form a coalition government in Germany had collapsed. General euro strength was the latest drive, as EUR-USD topped the 1.1900 mark. The cross had posted a 34-month high at 1.1723 the previous week, though with political uncertainties now prevailing in Germany (where new elections may not happen until next March), we expect EUR-CHF to trend sideways, with risks tilted to the downside for now. Key support is at 1.1542-45.

    [USD, CAD]
    USD-CAD has faded to 1.2694 intra day lows, remaining under pressure on the back of a generally soft greenback, and firm WTI crude prices, and giving back the bulk of gains seen on Thursday following weak Canada retail sales data. Yesterday's 1.2673 bottom will be the next support level.

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