Home > XE Currency Blog > XE Market Analysis: Asia - Sep 16, 2019


XE Currency Blog

Topics7137 Posts7182
By XE Market Analysis September 16, 2019 2:13 pm
    XE Market Analysis's picture
    XE Market Analysis Posts: 5061
    XE Market Analysis: Asia - Sep 16, 2019

    The Dollar headed higher in N.Y. trade on Monday, with safe-haven flows driving gains. The attack on Saudi oil infrastructure over the weekend saw gold and Treasuries head higher (along with oil prices), while equity markets were broadly lower. Incoming U.S. data was light, and a weaker Empire State index had little impact on the markets. EUR-USD faded to 1.0993 lows, while USD-JPY managed modest gains to 108.09, despite the risk-off backdrop. USD-CAD peaked at 1.3271, though struggled to hold higher as WTI crude prices rallied as much as 15%. Cable eased to 1.2399.

    [EUR, USD]
    EUR-USD remained heavy, bottoming at 1.0993, down from Asian highs of 1.1086. Risk-off conditions following the weekend attack on Saudi oil infrastructure, along with potential for rising U.S./Iran tensions, after Trump's "locked and loaded" tweet have supported the Greenback generally. Initial EUR-USD support comes at 1.0927, last Thursday's low, which was just a point above the two-plus year low of 1.0926 seen on September 3.

    [USD, JPY]
    USD-JPY has managed modest gains since the U.S. open, peaking at 108.09, from opening levels of 107.68. The pairing bottomed at 107.45 in opening Asian dealings, after closing Friday at 108.05, with the risk-sensitive Yen gapping higher on the Saudi oil infrastructure attack over the weekend. Since then the Dollar has perked up, largely on the back of safe-haven flows. Friday's one-month high of 108.25 now marks resistance.

    [GBP, USD]
    Cable fell to 1.2399 ahead of the London close, down from London highs of 1.2480. On the Brexit front, the UK's Supreme Court will hear this Thursday the government's appeal on the ruling from Scotland's highest court that the government's suspending of parliament was illegal. Most likely the Supreme Court will agree with the recent court rulings seen in England and Northern Ireland, that the matter was political rather than legal. This would leave Parliament closed until the week of October 14, ahead of the EU leader's summit on October 17. Prime Minister Johnson met with European Commission President Juncker and the EU's lead Brexit negotiator Barnier, though no progress was reported.

    [USD, CHF]
    EUR-CHF remained under pressure following the Saudi oil attack, wit the CHF again showing its safe-haven credentials. The cross fell to 1.0912 lows, from 1.0975 highs seen on Friday. Talk of the U.S. preparing military response to Iran will likely keep a cap on the pairing for now.

    [USD, CAD]
    USD-CAD gapped lower at the Asian open overnight, falling from Friday's close of 1.3284 to 1.3210 lows. The attack on Saudi oil infrastructure, and the subsequent surge in oil prices was the initial driver. Buyers emerged ahead of the 50-day moving average at 1.3205, taking prices to 1.3271 highs during the North American session. WTI crude remained higher, up nearly 12% in afternoon trade at $61.40, which will likely limit USD-CAD gains going forward.

    Paste link in email or IM