Forex news and trading headlines 18 Jan 2016

  • News:
  • UK's Davis says EU contributions won't be more than GBP 350m post-Brexit
  • Pound retreats after the May(hem) but what now? More May belief or maybe not?
  • Germany's Gabriel is in a conciliatory mood today
  • BOE to leave monetary policy on hold until at least 2019 - Reuters poll
  • Japan's Suga says they will watch FX moves with vigilance
  • IMF's Lagarde says policy makers should listen to feedback from voters
  • Latest Reuters poll sees PBOC keeping rates steady to at least Q2 2018
  • China says it will cut company fees to increase economic growth
  • Option expiries for the 10 am NY cut today 18 Jan
  • Nikkei 225 closes up +0.43% at 18,894,37

Data:

  • December 2016 UK claimant count -10.1k vs 5.0k exp
  • December 2016 Eurozone CPI 1.1% vs 1.1% exp y/y
  • Germany December CPI final mm +0.7% vs +0.7% exp
  • November 2016 Eurozone construction output 0.4% vs 0.4% prior m/m

After the speech comes the reality and the after-party hangover has left some GBP bulls clutching at air but it's been more a case of consolidation again for the greenback.

In reality it's been a lacklustre session with much of the USD recovery happening in Asia but USDJPY has nudged a little higher from 113.00 to test 113.50 while EURUSD has failed above 1.0700 again but finding demand into 1.0680.

It's the pound though that has looked most vulnerable and GBPUSD falls in Asia from 1.2400 had Europe opening at 1.2360 and we've since posted 1.2290 in a fairly steady decline. EURGBP found support into 0.8760 again and rallied to 0.8793 as I type.

USDCHF though has been slower to go with the dollar flow and the pair has drifted back into 1.0000 as EURCHF has another look at 1.0700.

Equities have largely been on the back foot but to varying degree and the FTSE has found a few buyers again on the softer GBP correlation.

Oil has seen significant falls with WTI down to $52.40 from $53.50 and Brent to $ 54.51 from $55.80 and that's helped USDCAD to highs of 1.3114 from 1.3050

More data and Yellen to come so this day is likely to liven up further.