Forex - European Highlights -Friday January 10 2020


 11:17 (GMT) 10 Jan

  [Forex Highlights]

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European Highlights -Friday January 10 2020 (0101-QFLZ-C01)

European Highlights

January 10 2020

Asia FX and News:

+ House Votes to Curb Trump Power to Strike Iran without Congress ~ BBG

+ A quiet Friday with market looking forward to the NFP report. AUD outperformed in Asia. Retail sales was better-than-expected, +0.9% vs exp. 0.4%. However, immediate gains in AUD/USD were brief before gradually finding buyers into midday, but still slightly short of testing Thursday's high of 0.6880. AUD/NZD edged higher towards 1.04. NZD/USD held above 0.66, traded in a tight range. AUD/CAD the laggard in the Asian hours ahead of Canadian jobs report, with oil prices still on the defensive. Scandis and GBP slightly firmer against EUR and USD, with no obvious catalysts. USD/JPY holding onto this week's strong gains, around 109.50.

Nikkei and JGB:

+ Nikkei +0.47%, JGB 10yr yield at -0.004%

Europe FX and news

European Highlights -Friday January 10 2020 (0101-QFLZ-C01)

+ The USD stayed firm through the European morning, with positive risk appetite and some expectation of a strong US employment report supporting a EUR/USD decline below 1.11 and a USD/JPY move to new highs for the year, just below the December high of 109.73.

+ News in Europe was thin on the ground. Norwegian CPI was weaker than expected in December, showing just a 1.4% rise y/y against 1.5% But the NOK impact was small and short lived, with EUR/NOK briefly rising to 9.89 before dropping back to opening levels at 9.86.

+ There were various European industrial production numbers, with the Spanish data most notable, showing a 2.1% y/y rise in November against the market expectation of a 0.5% decline. The French data was slightly stronger than expected while the Italian data was in line. Swedish production and orders data recovered strongly from a weak October, but there was no significant market reaction.

+ UK MPC member Tenreyro gave GBP some brief support by talking of the tightness of the UK labour market. But she also echoed Carney's comments by indicating she was thinking about a possible near term policy easing. EUR/GBP move back to near opening levels just below 0.85 by the end of the morning.

Bonds and equities

+ Following opening support, limited action from bunds ahead of US data. Gilts continue to outperform, eventually supported by BoE Tenreyro's comments (minded to cut if downside risks emerge) after some chop on initial headlines. BTPs see extension of yesterday p.m's preemptive cash buying ahead of supply, drives IT10s in 5.5bp.

Data:

AU: AIG Services PMI (Dec) 48.7 (Prev: 53.7)

JP: Household spending (Nov) -2.0% y/y (Mkt: -2 Prev: -5.1)

AU: Retail Sales (Nov) 0.9% m/m 4cast: 0.4 (Mkt: 0.4 Prev: 0)

06:45 GMT - CH: Unemployment (sa) (Dec) % (Mkt: 2.3 Prev: 2.3)

07:00 GMT - NO: CPI Core (Dec) % m/m (Prev: 0.1)

07:00 GMT - NO: CPI (Dec) % m/m (Mkt: 0.1 Prev: 0.3)

07:00 GMT - NO: CPI (Dec) % y/y (Mkt: 1.5 Prev: 1.6)

07:00 GMT - NO: CPI Core (Dec) % y/y (Prev: 2)

07:30 GMT - FR: BoF Business Sentiment (Dec) (Mkt: 97 Prev: 97)

07:45 GMT - FR: Manufacturing Production (Nov) % m/m (Prev: 0.4)

07:45 GMT - FR: Manufacturing Production (Nov) % y/y (Mkt: 0.4 Prev: -0.2)

08:00 GMT - ES: Industrial Production (Nov) % m/m (Prev: -0.4)

08:00 GMT - ES: Industrial Production (Nov) % y/y (Prev: -1.3)

08:30 GMT - SE: Industrial Production (Nov) % y/y (Prev: -3)

09:00 GMT - IS: Trade Balance (Dec P) ISK bn (Prev: -4376)

10:00 GMT - IT: Industrial Production (Nov) % m/m (Mkt: 0 Prev: -0.3)

10:00 GMT - IT: Industrial Production (Nov) % y/y (Mkt: -0.6 Prev: -2.4)

Still to be released:

13:30 GMT - CA: Employment (Dec) 4cast: 30 k (Mkt: 25 Prev: -71.2)

13:30 GMT - CA: Unemployment (Dec) 4cast: 5.8% (Mkt: 5.8 Prev: 5.9)

13:30 GMT - US: Unemployment (Dec) 4cast: 3.5% (Mkt: 3.5 Prev: 3.5)

13:30 GMT - US: Average Hourly Earnings (Dec) 4cast: 0.3% m/m (Mkt: 0.3 Prev: 0.2)

13:30 GMT - US: Private Payrolls (Dec) 4cast: 180k (Mkt: 153 Prev: 254)

13:30 GMT - US: Non-farm Payrolls (Dec) 4cast: 185k (Mkt: 160 Prev: 266)

15:00 GMT - US: Wholesale Inventories (Nov F) % m/m (Mkt: 0 Prev: 0)

Events

09:30 GMT - UK: BoE's Tenreyro Speaks in London on the Labor Market Outlook


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