Forex - GOOD MORNING Latam! (FX HIGHLIGHTS BRL MXN ARS CLP COP PEN)...


 11:45 (GMT) 14 Feb

  [Forex Highlights]

Sample Premium Content

RECAP CURRENCIES, DATA AND EVENTS.

European FX and News -

GOOD MORNING Latam! (FX HIGHLIGHTS BRL MXN ARS CLP COP PEN)... (0100-XNPK-C01)

+ A quiet session so far with ranges relatively tight and the focus on today's US data, CPI top of the list. EUR/USD has seen a late drift lower after failing to match the Asia session high, some risk being taken off before the data releases.

+ USD/JPY has gained some support on short covering and a positive session so far for European equities even if the Nikkei futures are only modestly in positive territory. EUR/JPY, however, is struggling to get back onto the 133 handle.

+ GBP still struggles for any upside with EUR/GBP now camped on .89, GBP/JPY well below 150 and Cable upside depending on the USD to do all the work. Brexit still very much centre stage with Foreign Minister and arch-Brexiteer Johnson with a major speech.

+ AUD and NZD found some modest support late morning but still in familiar territory with the NZD still ahead. CAD traders are keeping a close eye on Crude (WTI ~35c in the red) ahead of US inventory data later.

+ The Riksbank left policy unchanged with Ohlsson dissenting but the dip in EUR/SEK short-lived. Jansson has been altogether more dovish since, still focused on the SEK 'not firming too rapidly'.

Bonds and Equities -

+ Bond trade subdued ahead of US CPI, the US curve a fraction flatter after o/n long end support, DE30s underperform into supply. FTSE and Eurostoxx both up 0.5%, Mar E-minis +10pts.

US DATA

GOOD MORNING Latam! (FX HIGHLIGHTS BRL MXN ARS CLP COP PEN)... (0100-XNPK-C02)

Today is this week's key day for US data, with Jan CPI and retail sales due. For CPI we expect 0.4% rise overall with a 0.2% gain ex food and energy, though we see the core rate at 0.24% before rounding so risk is on the upside. Retail sales however should see a pause after a strong Q4 when spending outpaced income. We expect a flat figure overall, with gains of 0.3% ex auto and 0.2% ex auto and gasoline. Dec business inventories are also due today.

Recap EMGE Europe

The lira appreciated a bit at the beginning of Wednesday's session with the USD/TRY temporarily falling to 3.797, helped by the US dollar' broad-based depreciation as well as comments by NATO Secretary General Jens Stoltenberg, who said that Turkey had "some legitimate security concerns" in Syria. But we still expect the currency to suffer from the risk of the military conflict between the U.S. and Turkey in northern Syria in the near term, with the USD/TRY possibly surpassing the key 3.848 resistance level.

GOOD MORNING Latam! (FX HIGHLIGHTS BRL MXN ARS CLP COP PEN)... (0100-XNPK-C03)

South African assets gained at the start of Wednesday's session with the USD/ZAR briefly falling to 11.84 and government bond yields decreasing by 4-5bps across the curve. They were supported by expectations of President Jacob Zuma's resignation, reports that the police detained a Gupta brother (a member of the family who are investigated for corruption) as well as the broadly softer US dollar.

The retail sales release is due at 11:00 GMT and we expect it to show that sales growth slowed in December from a 5-year high of 8.2% y/y in November. But we think that the rand will appreciate further in the next few sessions because of Zuma's probable departure as well as the likely softer-than-expected US January retail sales, housing starts and building permits data, with the USD/ZAR potentially falling below the key 11.798 support level.


CurrenciesCountriesMarket Bulletins

Latest Currency Analysis

Available to subscribers only
Order Now