Recap for March 6th Monday
Today was an usual Monday with no tier on datas in both London and NY sessions, however, the real catalyst will come later on in Asia session from RBA rate decision which is expected to be unchanged.
Last Asia session we saw AUD Retail Sales m/m which came out as expected and better than previous 2 months.
Iran says OPEC will likely need to extend output cuts. If that’s the case then we should see another surge in the oil market.
North Korean launched another missile test and we should see some follow ups from Japan, South Korean and U.S.
For EUR
This week we will have ECB meeting and the rate & bond buying will most likely be unchanged. Eurozone is still suffering from the political drama especially the French elections. The sentiment is still largely negative. Fundamentally, as long as the ECB keeps the QE environment, we’re still bearish in the currency. The notable thing is that now the inflation has hit the target of 2%, and ECB will have to address this issue in the upcoming meeting. A lot of speculations have already gone in Euro to push it higher.
For USD
Now the March rate hike is very likely to happen according to Yellen’s last speech on Friday. Of course, market is always sentimental and one should be careful if the rate is not hike after all; or if the rate is indeed hike which we might see a sell-off for buying rumour and selling facts.
Fundamentally USD is still bullish from the hawkish Fed to positive datas and possible fiscal policies.
We still remain faithful in buying USD especially with any dips to attractive support levels.
For GBP
We have very little catalysts from UK today, but this is really like a quietness before the storm. We think because of the Brexit, March will be a very volatile month for UK and the downside risk is very large. Fundamentally, BOE was neutral on the rate but now since the datas have been quiet disappointing, it’s now leaning more to the dovish side.
For CAD
We don’t have much movements from oil market today, and the picture for CAD is stilll quiet weak. Regardless of the positive datas and strong support from OPEC, the biggest risk for CAD is the dovish central banks in regards to the NAFTA deals. Unless we can see a light of that, CAD will continue to be pressured.
For AUD
The RBA is expected to hold the rate steady and perhaps be more hawkish as their prediction for Q4 GDP was correct in a positive deviations. If that’s the case, alone with the surging commodity prices, AUD will continue to outperform most currencies.
For NZD
NZD remains to be bearish due to the dovish RBNZ. Regardless of the positive datas, NZD has been sold off across the board. The central bank negative sentiment might be faded, but unless we have clear sign, avoid catching the falling knife.
For JPY
Yen continues to be neutral in terms of sentiment. BOJ still remains positive in their QE and no signs of tapering as the inflation is still way below the target.
For CHF
CHF is in the same spot of JPY with more negative sentiment as it’s right within the Eurozone now.
Current Central Banks Positions
Hawkish
FED
RBA
Neutral
BOE
Dovish
ECB
BOC
RBNZ
SNB
BOJ
Current Bank Rates
NZD > AUD > USD > CAD > GBP > EUR > JPY > CHF
10 yrs Bond Yields
NZD 3.345
AUD 2.829
USD 2.494
CAD 1.709
UK 1.217
EUR 0.340
JPY 0.063
CHF -0.127
Recap for March 6th Monday
Today was an usual Monday with no tier on datas in both London and NY sessions, however, the real catalyst will come later on in Asia session from RBA rate decision which is expected to be unchanged.
Last Asia session we saw AUD Retail Sales m/m which came out as expected and better than previous 2 months.
Iran says OPEC will likely need to extend output cuts. If that’s the case then we should see another surge in the oil market.
North Korean launched another missile test and we should see some follow ups from Japan, South Korean and U.S.
For EUR
This week we will have ECB meeting and the rate & bond buying will most likely be unchanged. Eurozone is still suffering from the political drama especially the French elections. The sentiment is still largely negative. Fundamentally, as long as the ECB keeps the QE environment, we’re still bearish in the currency. The notable thing is that now the inflation has hit the target of 2%, and ECB will have to address this issue in the upcoming meeting. A lot of speculations have already gone in Euro to push it higher.
For USD
Now the March rate hike is very likely to happen according to Yellen’s last speech on Friday. Of course, market is always sentimental and one should be careful if the rate is not hike after all; or if the rate is indeed hike which we might see a sell-off for buying rumour and selling facts.
Fundamentally USD is still bullish from the hawkish Fed to positive datas and possible fiscal policies.
We still remain faithful in buying USD especially with any dips to attractive support levels.
For GBP
We have very little catalysts from UK today, but this is really like a quietness before the storm. We think because of the Brexit, March will be a very volatile month for UK and the downside risk is very large. Fundamentally, BOE was neutral on the rate but now since the datas have been quiet disappointing, it’s now leaning more to the dovish side.
For CAD
We don’t have much movements from oil market today, and the picture for CAD is stilll quiet weak. Regardless of the positive datas and strong support from OPEC, the biggest risk for CAD is the dovish central banks in regards to the NAFTA deals. Unless we can see a light of that, CAD will continue to be pressured.
For AUD
The RBA is expected to hold the rate steady and perhaps be more hawkish as their prediction for Q4 GDP was correct in a positive deviations. If that’s the case, alone with the surging commodity prices, AUD will continue to outperform most currencies.
For NZD
NZD remains to be bearish due to the dovish RBNZ. Regardless of the positive datas, NZD has been sold off across the board. The central bank negative sentiment might be faded, but unless we have clear sign, avoid catching the falling knife.
For JPY
Yen continues to be neutral in terms of sentiment. BOJ still remains positive in their QE and no signs of tapering as the inflation is still way below the target.
For CHF
CHF is in the same spot of JPY with more negative sentiment as it’s right within the Eurozone now.
Current Central Banks Positions
Hawkish
FED
RBA
Neutral
BOE
Dovish
ECB
BOC
RBNZ
SNB
BOJ
Current Bank Rates
NZD > AUD > USD > CAD > GBP > EUR > JPY > CHF
10 yrs Bond Yields
NZD 3.345
AUD 2.829
USD 2.494
CAD 1.709
UK 1.217
EUR 0.340
JPY 0.063
CHF -0.127