Forex - US North American Summary and Highlights 8 Nov


 21:05 (GMT) 08 Nov

  [Forex Highlights]

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Overview

US North American Summary and Highlights 8 Nov (0101-PXBJ-C04)

Trump caused a modest dip in equites and USD/JPY by stating he had not agreed to rollback tariffs on China, but the impact was modest, the USD generally firm and equities and USTs broadly stable.

News highlights

- US preliminary Nov Michigan CSI 95.7 vs 95.5 Oct final and exp.

- US Sep wholesale inventories -0.4% vs -0.3% exp, sales 0.0% vs +0.2% exp.

- Trump said hasn't agreed on tariff rollback with China.

Currencies:

US North American Summary and Highlights 8 Nov (0101-PXBJ-C01)

The USD continued to edge slightly higher across the board in a quiet European morning session, USD/JPY getting close to 109.50. However USD/JPY had already peaked when Trump triggered a modest sell-off by stating he had not agreed to roll back tariffs on China. The dip did not seriously threaten 109.00 however.

EUR/USD continued to drift lower without any real news trigger while posing little threat to 1.10. Trade data from Germany and France showed a slightly larger German surplus and a slightly larger French deficit than expected. French production rose 0.3% as expected in September, while non-farm employment rose 0.3% in Q3.

US North American Summary and Highlights 8 Nov (0101-PXBJ-C02)

GBP held steady against the otherwise strong USD in the European morning but tbe afternoon saw GBP/USD dip below 1.28, EUR/GBP finding buyers below .86..

The Canadian employment report showed a small decline in employment in October following two very strong months of gains, with details quite weak outside a pre-election rise in public sector jobs, though wage growth remained strong at 4.4%. USD/CAD rose above 1.32. Despite this AUD/CAD was heavy, AUD/USD falling to near .6850.

Bonds:

US North American Summary and Highlights 8 Nov (0101-PXBJ-C03)

Some better UST dip buying in Asia, US10s in the mid 1.9%, after the good 30yr auction and mixed signals on tariff rollback. However, the market remained defensive all the same, options hedging noted, and not much of a correction lasting into NY trade. Equities too hold up pretty flat. Not much of an equity dip / yield trim as Trump says has not agreed to tariff rollback though China would like him to. 2s -0.3bps @ 1.66%, 5s +0.2bps @ 1.73%, 10s +1.2bps @ 1.93%, 30s +1.7bps @ 2.41%.

Agency Spreads: Freddie/Fannie 5s -0.3/+0.6 bps, 10s +0.1/-1.2 bps.

Swap Spreads: 2s +1.56bps, 5s +0.05bps, 10s -0.57bps.

Equities

Equities did see a modest dip as Trump said he had not agreed to roll back tariffs on China, though the dip was reversed and the market closed marginally higher. Energy was the main negative, health care the main positive.

Still to come -

Data

23:50 GMT - JP: Core Machine orders (Sep) % y/y (Mkt: 1.6 Prev: -14.5)

23:50 GMT - JP: Bank Lending Data (Ex trusts) (Oct) % y/y (Prev: 2.2)

07:00 GMT - NO: CPI Core (Oct) % m/m (Prev: 0.6)

07:00 GMT - NO: CPI (Oct) % m/m (Prev: 0.5)

07:00 GMT - NO: CPI (Oct) % y/y (Prev: 1.5)

07:00 GMT - NO: CPI Core (Oct) % y/y (Prev: 2.2)

09:30 GMT - UK: Index of Services (Sep) 4cast: -0.1% m/m (Mkt: 0.1 Prev: 0)

09:30 GMT - UK: Industrial Production (Sep) % m/m (Mkt: -0.1 Prev: -0.6)

09:30 GMT - UK: Manufacturing Production (Sep) 4cast: -1.5% m/m (Mkt: -0.2 Prev: -0.7)

09:30 GMT - UK: GDP (3Q P) 4cast: 0.3% q/q (Mkt: 0.4 Prev: -0.2)

09:30 GMT - UK: GDP (Sep) 4cast: -0.1% m/m (Mkt: -0.1 Prev: -0.1)

09:30 GMT - UK: Construction Output (sa) (Sep) % m/m (Mkt: 0.2 Prev: 0.2)

09:30 GMT - UK: Construction Output (sa) (Sep) % y/y (Mkt: 1.5 Prev: 2.4)

09:30 GMT - UK: Industrial Production (Sep) % y/y (Mkt: -1.2 Prev: -1.8)

09:30 GMT - UK: Manufacturing Production (Sep) % y/y (Mkt: -1.3 Prev: -1.7)

09:30 GMT - UK: Trade Balance (Non-EU) (Sep) GBP bn (Mkt: -2.5 Prev: -2.206)

09:30 GMT - UK: Visible Trade Balance (Sep) GBP bn (Mkt: -10 Prev: -9.806)

09:30 GMT - UK: Index of Services (Sep) % 3m/3m (Mkt: 0.5 Prev: 0.4)

10:00 GMT - IT: Industrial Production (Sep) % m/m (Mkt: -0.4 Prev: 0.3)

10:00 GMT - IT: Industrial Production (Sep) % y/y (Mkt: -2 Prev: -1.8)

12:00 GMT - JP: Economy Watchers Survey (Oct) (Mkt: 41.9 Prev: 36.9)

23:50 GMT - JP: M2 Money Supply (Oct) % y/y (Mkt: 2.4 Prev: 2.4)

Events

23:50 GMT - JP: BoJ summary of opinions

13:15 GMT - US: Fed's Rosengren speaks in Oslo


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