Forex - European Highlights Wednesday January 22 2020

 11:11 (GMT) 22 Jan

  [Forex Highlights]

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European Highlights Wednesday January 22 2020 (0101-QHGQ-C01)

European Highlights

January 22 2020

Asia FX and News:

+ China virus remains in the spotlight, though early Asian risk-negative move in AUD was faded as CNY and Chinese equities staged a reversal. AUD/USD fell to a low of 0.6827 before heading back to flat to stay above the 100dma. Australian consumer confidence continues to weaken but no immediate impact seen on AUD. USD strengthens against the G10s, apart from the Scandis. USD/JPY regains 110 as risk appetite recovers in spite of more cases of coronavirus in more countries and virus mutation possibility. Yen weakens across the board with E-minis finding new highs.

Nikkei and JGB:

+ Nikkei +0.70%, JGB 10yr yield at 0.001%

Europe FX and news

European Highlights Wednesday January 22 2020 (0101-QHGQ-C01)

+ The USD was a touch weaker through the European morning, dropping around 10 pips against the EUR, JPY and CAD.

+ GBP rose modestly in response to the CBI industrial trends survey, which showed a sharp rise in optimism but less evidence of improvement in orders or output.

+ There was initial interest in reports that De Maio is set to quit as leader of the 5-Star party who are coalition partners in the Italian government, though most do not see this as likely to bring down the government, and there was no FX impact.

+ UK trade was in focus, with US treasury secretary Mnuchin indicating that a trade agreement with the UK was a priority for 2020. A Telegraph report indicated that the EU Commission is taking a very hard line in its position on future trading arrangements with the UK, saying it would be a mistake to allow UK industry bodies to certify that goods conform to EU standards, potentially withholding the Mutual Recognition Agreements (MRAs) that are granted to other EU trade partners.

+ EUR/CHF moved a little higher having tested 3 year lows for the last few days, but with no clear trigger, despite some talk of SNB involvement.

Bonds and equities

+ Bunds following Treasuries lower Wednesday morning, as the risk off mood in equities partially reversed. However, the world health organisation is meeting today and this could cause some concerns about the China coronavirus again - though medical experts so far note that the current version is not highly contagious. Meanwhile, BTP's seeing a sharp selloff on Wednesday, as reports circulate in Italy that the five star leader could resign this week. Gilts performing well on Wednesday and marginally better than other markets


AU: Internet Skilled Vacancies (Dec) 0.6% m/m (Prev: -0.0R)

JP: Tokyo Department Store (Dec) -3.2% y/y (Prev: -4.7)

07:45 GMT - FR: INSEE Manufacturing Confidence (Jan)(Mkt: 101 Prev: 102)

09:00 GMT - IT: Industrial Sales (Nov) % m/m (Prev: 0.6)

09:00 GMT - IT: Industrial Orders (Nov) % m/m (Prev: 0.6)

09:00 GMT - IT: Industrial Sales (Nov) % y/y (Prev: -0.2)

09:00 GMT - IT: Industrial Orders (Nov) % y/y (Prev: -1.5)

09:30 GMT - UK: Public Borrowing (PSNB ex banks) (Dec) GBP bn (Mkt: 5.2 Prev: 5.6)

09:30 GMT - UK: Public Finances (PSNCR) (Dec) GBP bn (Prev: 9.9)

Still to be released:

13:30 GMT - CA: House Price Index (Dec) % (Mkt: 0 Prev: )

13:30 GMT - CA: Wholesale Sales (Nov) % m/m (Mkt: -0.4 Prev: -1.1)

13:30 GMT - CA: CPI (Dec) 4cast: -0.1% m/m (Mkt: 0 Prev: -0.1)

13:30 GMT - CA: CPI (Dec) 4cast: 2.2% y/y (Mkt: 2.3 Prev: 2.2)

15:00 GMT - CA: BoC Rate (22 JAn) 4cast: 1.75 (Mkt: 1.75 Prev: 1.75)

15:00 GMT - US: Existing Home Sales (Dec) 4cast: 5.49mn (Mkt: 5.42 Prev: 5.35)

15:00 GMT - US: FHFA House Price Index (Nov) % m/m (Mkt: 0.3 Prev: 0.2)

23:50 GMT - JP: Exports (Dec) 4cast: -3.1% y/y (Mkt: -4.3 Prev: -7.9)

23:50 GMT - JP: Imports (Dec) 4cast: -1.7% y/y (Mkt: -3.2 Prev: -15.7)

23:50 GMT - JP: Trade Balance (nsa) (Dec) 4cast: -153.1JPY bn (Mkt: -152.6 Prev: -85.2)

23:50 GMT - JP: Trade Balance (sa) (Dec) JPY bn (Mkt: -236 Prev: -60.8)


07:40 GMT - UK: BoE's Carney Speaks in Davos

16:15 GMT - CA: BoC's Poloz Speaks after Rate Decision

16:15 GMT - CA: Bank of Canada press conference

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