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By xemarketanalysis February 21, 2019 1:14 pm
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    XE Market Analysis: Currency Market Steady Following FOMC Minutes and now Waits for Sino-US Trade Deal Announcement

    OVERVIEW

    • The US dollar remains in consolidation mode against the major currencies

    • The Australian dollar is experiencing volatile session, plunging nearly 1.1% against its US counterpart

    • NYMEX WTI Crude consolidates around $57.00 a barrel, appreciating 25% so far this year.

    HIGHLIGHT

    The Australian dollar plunged more than 1% against the greenback after reports surfaced that a Chinese port is stopping its coal shipments from the country. The news erased all previous gains from strong employment numbers. The economy added 39k new jobs beating market’s estimates. However, the action from China send investors into panic mode, putting the currency under severe selling pressure. We expect AUD/USD to remain very sensitive and volatile.

     

    US DOLLAR

    The US dollar is steady this morning after the minutes confirmed the “patient” approach from the Fed and future adjustments would be data-dependent amidst a global economic slowdown. Meanwhile, the latest data revealed core durable goods orders declined unexpectedly while initial claims recorded a decrease of 23k from previous readings. The market continues to digest the incoming data, but the Australian dollar is the talk of the town today. The currency fell nearly 1.1% after reports emerged that China will ban coal imports from the country. 

    BRITISH POUND

    The British Pound is trading with a slightly positive mood on growing Brexit optimism. The Sterling in consolidation mode after touching a three week high. The market is hoping for a major breakthrough from Brussels, where UK Prime Minister May is meeting with EC President Juncker. A delay of the March 29 deadline is looking more likely with each passing day as both parties try to rewrite the Withdrawal Plan.

    EURO

    The minutes from the FOMC revealed concerns of weakening economic indicators from the euro area and the flash manufacturing PMI from Germany seems to confirm the trend. Flash Manufacturing PMI hit a 6-year low. The sector contracts further with export orders declining the most. The EUR/USD pair remains stubborn, trading around the mid-point of 1.13.

    CANADIAN DOLLAR

    USD/CAD is trading flat, near the critical 200-day moving average of 1.3150 levels. The market waits on the speech from BoC Governor Poloz speech on monetary policy at the Chamber of Commerce of Metropolitan Montreal. WTI oil prices touched a 3-month high, and a rebound in wholesale sales in December are providing support to the loonie.

    AUSTRALIAN DOLLAR

    AUD/USD surged above the 0.72 level on the back of strong Australian job numbers but only to collapse following reports that the RBA will explore the options to cut rates and China will ban coal exports from the country. The pair is expected to remain volatile as the market digests the news and assesses its impact on the economy at large.

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