Forex News

  • Japan ruling party said to be divided if Kishida seeks BOJ pivot
    by Justin Low on February 9, 2023 at 6:07 am

    <p style="" class="text-align-justify">That raises a bit of doubts about Japan pushing for a change in monetary policy (or perhaps the opposite depending on how you want to look at it). However, I'd prefer if we do get something more concrete as recent communication has been suggesting that the government does indeed want to seek potential policy changes moving forward - or at least be afforded that flexibility. If anything else, it goes to show how sensitive the currency is at the moment to any headlines surrounding the <a href="https://www.forexlive.com/terms/b/boj/" class="terms__main-term" id="c1f60108-4283-4827-911e-95f01607c737" target="_blank">BOJ</a> and Kuroda's successor.</p> This article was written by Justin Low at www.forexlive.com.

  • German inflation in focus on the agenda today
    by Justin Low on February 9, 2023 at 6:03 am

    <p style="" class="text-align-justify">After risk sentiment soured trading yesterday, we are seeing a light pullback today with US futures higher and the dollar slightly on the softer side. It's not much as market players are caught in a fierce battle after a hectic last one week which is now more or less bookended by remarks from Fed chair Powell.</p><p style="" class="text-align-justify">The S&P 500 fell by 1.1% yesterday but buyers are still keeping the faith closer to 4,100 for the time being. That will be a pivotal line to watch for risk trades as the market mood remains the key driver of trading sentiment at the moment.</p><p style="" class="text-align-justify">Looking ahead, German inflation data will be one to pay attention to in Europe in terms of data before we get to the BOE monetary policy hearing in parliament at roughly 0945 GMT and the latest European Commission economic forecasts at 1000 GMT.</p><p style="" class="text-align-justify">0700 GMT - Germany January preliminary CPI figures</p><p style="" class="text-align-justify">That's all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.</p> This article was written by Justin Low at www.forexlive.com.

  • A light reprieve but don't rest on your laurels just yet
    by Justin Low on February 9, 2023 at 5:54 am

    <p style="" class="text-align-justify">Markets are sensing a bit part relief on the day with S&P 500 futures up 15 points, or 0.4%, and the dollar slightly on the softer side so far today. That comes after risk sentiment soured in trading yesterday, raising questions about the overall outlook. The dollar was also a modest gainer as it continues to build on gains since Friday, though <a href="https://www.forexlive.com/news/dollar-slightly-on-the-softer-side-on-the-day-20230208/" target="_blank" rel="follow">the technical range still leaves a lot to be desired</a>.</p><p style="" class="text-align-justify">Considering how we are in an extremely data-reliant phase, just be mindful of the German inflation data coming up later at 0700 GMT. There will be changes to how the numbers will be calculated as noted <a href="https://www.forexlive.com/news/a-couple-of-uncertainties-surrounding-germanys-inflation-data-today-20230209/" target="_blank" rel="follow">here</a>, so we'll have to see how that impacts the overall report. If we do see a higher number than estimated, that could very well turn the tide on the risk mood as we get into European trading.</p> This article was written by Justin Low at www.forexlive.com.

  • A couple of uncertainties surrounding Germany's inflation data today
    by Justin Low on February 9, 2023 at 5:38 am

    <p style="" class="text-align-justify">It may come at a time where we already got the Eurozone estimate for January consumer price inflation and also saw the ECB monetary policy decision already last week. However, the release today could set the tone for markets amid the focus on economic data and also validate or invalidate the outlook by ECB policymakers heading into March.</p><p style="" class="text-align-justify">For some context, the delay in the CPI report was supposedly due to "technical problems" as noted <a href="https://www.forexlive.com/news/germany-to-delay-cpi-data-until-next-week-20230130/" target="_blank" rel="follow">here</a> last week. However, Destatis is actually reworking its methodology for calculating consumer price inflation with 2022 spending patterns set to be more strongly accounted for.</p><p style="" class="text-align-justify">That means energy prices is more likely to be weighted more heavily, as we already saw happen with the Spanish report last week <a href="https://www.forexlive.com/news/spain-january-preliminary-cpi-58-vs-57-yy-prior-20230130/" target="_blank" rel="follow">here</a> - which was also reworked in a somewhat similar fashion. The question now is whether Destatis will adopt such an approach, but one can expect the report today to not be a straightforward one.</p><p style="" class="text-align-justify">Adding to that is also uncertainty surrounding the latest government subsidies on energy prices. As a reminder, Germany is paying December's monthly gas bill for all households and small- to medium-sized businesses as part of a phased two-stage cap on energy prices.</p><p style="" class="text-align-justify">How that will play into the inflation numbers will depend on how Destatis wants to book it essentially. That is because there is a part of the subsidy that will be backdated until March this year instead. The details:</p><p style="" class="text-align-justify">"From March 2023 to the end of April 2024, private households would pay €0.12 per kilowatt hour for the first 80% of last year’s use of gas. Industry, meanwhile, would from 1 January 2023 until end of April 2024 pay €0.07 per kilowatt hour for the first 70% of last year’s use."</p><p style="" class="text-align-justify">The estimate today for German CPI is to increase to 8.9% y/y, up from 8.6% y/y in December. But if anything else, don't expect the reading to be a simple and easy one to work out.</p> This article was written by Justin Low at www.forexlive.com.

  • ForexLive Asia-Pacific FX news wrap: USD a touch softer vs. other majors
    by Eamonn Sheridan on February 9, 2023 at 3:59 am

    <ul><li><a href="https://www.forexlive.com/Cryptocurrency/bitcoin-hourly-chart-looks-vulnerable-20230209/">Bitcoin hourly chart looks vulnerable</a></li><li><a href="https://www.forexlive.com/centralbank/the-day-is-near-when-the-japanese-government-will-present-it-nominees-for-boj-leadership-20230209/">The day is near when the Japanese government will present it nominees for BOJ leadership</a></li><li><a href="https://www.forexlive.com/centralbank/more-from-jpmorgan-ceo-dimon-warning-fed-rate-could-head-above-5-and-stay-there-20230209/">More from JPMorgan CEO Dimon warning Fed rate could head above 5%, and stay there</a></li><li><a href="https://www.forexlive.com/news/more-on-chinese-state-media-ai-companies-warn-of-risks-in-chatgpt-stock-frenzy-20230209/">More on Chinese state media, AI companies warn of risks in ChatGPT stock frenzy</a></li><li><a href="https://www.forexlive.com/news/jp-morgan-says-artificial-intelligence-could-prove-very-deflationary-remains-to-be-seen-20230209/">JP Morgan says Artificial Intelligence could prove VERY deflationary (remains to be seen)</a></li><li><a href="https://www.forexlive.com/news/passenger-car-sales-in-china-collapsed-38-yy-in-january-20230209/">Passenger car sales in China collapsed 38% y/y in January</a></li><li><a href="https://www.forexlive.com/centralbank/australias-4-largest-banks-have-all-passed-through-the-rba-rate-hike-20230209/">Australia's 4 largest banks have all passed through the RBA rate hike</a></li><li><a href="https://www.forexlive.com/centralbank/pboc-sets-usd-cny-reference-rate-for-today-at-67905-vs-estimate-at-67900-20230209/">PBOC sets USD/ CNY reference rate for today at 6.7905 (vs. estimate at 6.7900)</a></li><li><a href="https://www.forexlive.com/news/chinese-media-warns-not-to-blindly-participate-in-chatgpt-related-stock-speculation-20230209/">Chinese media warns not to blindly participate in ChatGPT-related stock speculation</a></li><li><a href="https://www.forexlive.com/centralbank/icymi-us-used-vehicle-prices-jumped-again-in-january-up-25-mm-20230209/">ICYMI - US used vehicle prices jumped again in January, up 2.5% m/m</a></li><li><a href="https://www.forexlive.com/news/uk-data-rics-house-price-indicator-falls-to-its-lowest-since-2009-20230209/">UK data - RICS house price indicator falls to its lowest since 2009</a></li><li><a href="https://www.forexlive.com/news/us-bound-container-shipments-from-asia-plunge-20230209/">US-bound container shipments from Asia plunge</a></li><li><a href="https://www.forexlive.com/news/us-president-biden-says-there-will-no-us-recession-in-2023-or-2024-20230208/">US President Biden says there will no US recession in 2023 or 2024</a></li><li><a href="https://www.forexlive.com/news/germanys-delayed-january-inflation-data-will-be-published-today-ballooning-higher-20230208/">Germany's delayed January inflation data will be published today - ballooning higher</a></li><li><a href="https://www.forexlive.com/news/us-president-biden-says-relations-with-china-have-not-taken-a-big-hit-20230208/">US President Biden says relations with China have not taken a big hit</a></li><li><a href="https://www.forexlive.com/news/morgan-stanley-with-3-reasons-the-sp500-bear-market-is-not-over-20230208/">Morgan Stanley with 3 reasons the S&P500 bear market is not over</a></li><li><a href="https://www.forexlive.com/centralbank/jp-morgan-ceo-dimon-says-the-federal-reserve-hiking-to-5-and-holding-there-is-sound-20230208/">JP Morgan CEO Dimon says the Federal Reserve hiking to 5% and holding there is sound</a></li><li><a href="https://www.forexlive.com/news/us-treas-sec-yellen-says-she-still-hopes-to-visit-china-but-has-no-current-plans-20230208/">US Treas Sec Yellen says she still hopes to visit China but has no current plans</a></li><li><a href="https://www.forexlive.com/centralbank/goldman-sachs-have-3-reasons-for-yen-weakness-in-the-coming-weeks-20230208/">Goldman Sachs have 3 reasons for yen weakness in the coming weeks</a></li><li><a href="https://www.forexlive.com/news/trade-ideas-thread-thursday-9-february-2023-20230208/">Trade ideas thread - Thursday, 9 February 2023</a></li><li><a href="https://www.forexlive.com/news/us-stocks-give-back-some-of-the-gains-from-yesterday-20230208/">US stocks give back some of the gains from yesterday</a></li><li><a href="https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-us-dollar-climbs-as-risk-appetite-slumps-20230208/">Forexlive Americas FX news wrap: US dollar climbs as risk appetite slumps</a></li></ul><p class="western"> EUR, AUD, GBP, CAD and NZD all traded a little stronger against the USD during the session. News flow was very light, as was data. On Wednesday New Zealand announced a boost to the minimum wage which should help household consumption but also increases the prospect of further Reserve Bank of New Zealand rate hikes given inflation in NZ is still high. </p><p class="western">USD/JPY popped in early Asia but has since come back to be barely changed on the session.</p><p class="western">The People's Bank of China injected funds via Open Market Operations again today. Despite this rates remained on the high side in China, near two year highs. Credit demand appears solid, which could well be indicating a better than expected pace of post-COVID economic recovery. Loan and aggregate financing data are expected sometime between now an February 15. </p><p class="western">BTC/USD has lost ground (see bullet above for rumour). </p><p class="western">Asian equity markets:</p><ul> <li><p class="western"> Japan’s Nikkei 225 -0.36%</p> </li><li><p class="western"> China’s Shanghai Composite +0.6%</p> </li><li><p class="western"> Hong Kong’s Hang Seng +0.3%</p> </li><li><p class="western"> South Korea’s KOSPI -0.17%</p> </li><li><p class="western"> Australia’s S&P/ASX 200 -0.6% </p> </li></ul> This article was written by Eamonn Sheridan at www.forexlive.com.

  • More on Chinese state media, AI companies warn of risks in ChatGPT stock frenzy
    by Eamonn Sheridan on February 9, 2023 at 2:44 am

    <p>Headline is here from earlier:</p><ul><li><a href="https://www.forexlive.com/news/chinese-media-warns-not-to-blindly-participate-in-chatgpt-related-stock-speculation-20230209/" target="_blank" rel="follow" data-article-link="true">Chinese media warns not to blindly participate in ChatGPT-related stock speculation</a></li></ul><p><a href="https://www.msn.com/en-us/money/other/chinese-state-media-ai-companies-warn-of-risks-in-chatgpt-stock-frenzy/ar-AA17gNKT" target="_blank" rel="nofollow">Reuters </a>adds more on the The Securities Times front-page editorial, saying that frenzy around the ChatGPT chatbot has spurred speculative bets in China's stock market, pumping up AI firms such as TRS Information Technology Co Ltd, Hanwang Technology Co Ltd and CloudWalk Technology Co Ltd.</p><p>More at that Reuters link. </p><p>Christine Lagarde AI art</p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • JP Morgan says Artificial Intelligence could prove VERY deflationary (remains to be seen)
    by Eamonn Sheridan on February 9, 2023 at 2:21 am

    <p>JP Morgan snippet on AI:</p><ul><li>We are in the early stages of understanding the impacts of AI, let alone fully grasping the implications of the technology.</li><li> From a business standpoint, AI could also prove VERY deflationary, not just for tech but for society (remains to be seen).</li></ul><p>You heard it here first:</p><ul><li><a href="https://www.forexlive.com/news/artificial-intelligence-isnt-just-a-technology-story-its-a-macro-story-20230206/" target="_blank" rel="follow" data-article-link="true">Artificial intelligence isn't just a technology story, it's a macro story</a></li></ul><p>"Great ..."</p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • Passenger car sales in China collapsed 38% y/y in January
    by Eamonn Sheridan on February 9, 2023 at 2:03 am

    <p>Info from the China Passenger Car Association (CPCA) comes via Reuters. </p><p>China's passenger car sales slumped 38% in January</p><p>reversing a 2.4% gain in the previous month</p><p>demand weakened after a tax cut on combustion engine cars and subsidies on electric vehicles (EV) expired</p><p>Lunar New Year was also cited, a full week of the Lunar New Year holiday in the month, making it a quieter January compared with the previous years.</p><p><a href="https://www.reuters.com/business/autos-transportation/china-car-sales-plunge-38-january-subsidies-tax-cut-end-2023-02-08/#:~:text=SHANGHAI%2FBEIJING%2C%20Feb%208%20" target="_blank" rel="nofollow">More here at Reuters </a></p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • Chinese media warns not to blindly participate in ChatGPT-related stock speculation
    by Eamonn Sheridan on February 9, 2023 at 12:55 am

    <p>China Securities Times with the front-page op-ed. </p><p>AI-related frenzy is only just beginning. </p><p>There, now you have your eyes open. </p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • UK data - RICS house price indicator falls to its lowest since 2009
    by Eamonn Sheridan on February 9, 2023 at 12:17 am

    <p>Royal Institution of Chartered Surveyors (RICS) house price balance</p><ul><li>fell to -47 in January from -42 in December</li><li>its lowest since April of 2009</li><li>measures the gap between the percentage of surveyors seeing rises and falls in house prices</li><li>measure of interest from buyers also fell to -47, its lowest since October last year</li></ul><p>Simon Rubinsohn, chief economist at RICS:</p><ul><li> said the overall mood of the market as measured by surveyors remained subdued</li><li>"However, it is questionable how much downside to pricing there is likely to be given that recent macro forecasts from the Bank of England and others are now envisaging a less harsh economic environment this year,"</li></ul><p>Info via Reuters </p><p>---</p><p>Separately, the UK Times newspaper is reporting that UK Chancellor Hunt is under pressure from the employers group, CBI, to provide tax breaks in the budget to avert a recession.</p><p>Old photo ... that rate is invalid, K? ;-) </p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • US-bound container shipments from Asia plunge
    by Eamonn Sheridan on February 9, 2023 at 12:05 am

    <p>Via the <a href="https://asia.nikkei.com/Economy/Trade/U.S.-bound-container-shipments-from-Asia-plunge-as-inflation-bites" target="_blank" rel="nofollow">Nikkei </a>in Japan, an update on shipping volumes and freight. Lower for both!</p><ul><li>Container ships brought a volume of goods totaling 1.31 million twenty-foot equivalent units (TEU) from Asia to the U.S. in December, down 23% from a year earlier, U.S. logistics researcher Descartes Datamyne reports. This marked the third straight month that the figure fell by about 20%.</li><li>shipping rates are sinking to three-year lows</li><li>Inflation has eroded consumer purchasing power, softening demand for household goods and slowing ocean shipping, said an official at a container ship company</li><li>retailers no longer stocking up inventories like they did during the height of the pandemic</li></ul><p>More at that link above, may be gated.</p><p>----</p><p>Each month I update on a data point from New Zealand that also includes a look at global shipping. Its been indicating this for many, many months too. Most recently (earlier this week):</p><ul><li><a href="https://www.forexlive.com/news/new-zealand-january-anz-commodity-price-index-comes-in-at-10-mm-prior-01-20230207/" target="_blank" rel="follow">The Baltic Dry Index is now at its lowest level since June 2020</a></li></ul> This article was written by Eamonn Sheridan at www.forexlive.com.

  • US President Biden says there will no US recession in 2023 or 2024
    by Eamonn Sheridan on February 8, 2023 at 11:40 pm

    <p>US President Biden is speaking in an interview with US media, PBS.</p><p>Earlier:</p><ul><li><a href="https://www.forexlive.com/news/us-president-biden-says-relations-with-china-have-not-taken-a-big-hit-20230208/" target="_blank" rel="follow" data-article-link="true">US President Biden says relations with China have not taken a big hit</a></li></ul><p>Biden adding those 'no recession' remarks. Its not unusual for senior politicians to goose economic comments, so take this with a grain of salt. The very strong recent jobs report does tend to support his assertion though. ICYMI:</p><ul><li><a href="https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-us-jobs-report-was-wow-number-20230203/" target="_blank" rel="follow" data-article-link="true">Forexlive Americas FX news wrap: US jobs report was a "WOW" number</a></li></ul><p>And its set off a conga line of Federal Reserve officials singing from the same sheet on the likelihood of further rate hikes:</p><ul><li><a href="https://www.forexlive.com/news/forexlive-americas-fx-news-wrap-us-dollar-climbs-as-risk-appetite-slumps-20230208/" target="_blank" rel="follow" data-article-link="true">Forexlive Americas FX news wrap: US dollar climbs as risk appetite slumps</a></li></ul><p><a href="https://giphy.com/gifs/dog-line-conga-ofegPosyLt5FS">via GIPHY</a></p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • Germany's delayed January inflation data will be published today - ballooning higher
    by Eamonn Sheridan on February 8, 2023 at 11:21 pm

    <p>Germany consumer price index data for January (preliminary) was due on the 31st of January. It was postponed due to a technical data processing problem, the country's statistics office Destatis said0</p><ul><li><a href="https://www.forexlive.com/news/germany-to-delay-cpi-data-until-next-week-20230130/" target="_blank" rel="follow">Germany to delay CPI data until next week</a></li></ul><p>Its coming up later today instead, at 0700 GMT, 0200 US Eastern time:</p><p class="western" align="left"> This snapshot from the ForexLive economic data calendar, <a href="https://www.forexlive.com/EconomicCalendar">access it here</a>.</p><p class="western" align="left"> The times in the left-most column are GMT. </p><p class="western" align="left"> The numbers in the right-most column are the 'prior' (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected.</p><p>---</p><p>Higher inflation is going to keep the ECB on the boil with another 50bp rate hike expected at the next meeting, due on March 16:</p> This article was written by Eamonn Sheridan at www.forexlive.com.

  • US President Biden says relations with China have not taken a big hit
    by Eamonn Sheridan on February 8, 2023 at 10:45 pm

    <p>US President Biden is being interviewed on US media, PBS</p><ul><li>Says relations with China have not taken a big hit</li><li>says the US going to fully compete with China and is not looking for conflict</li></ul><p>Biden doing media after his SOTU on Tuesday:</p><ul><li><a href="https://www.forexlive.com/news/us-president-biden-speaking-state-of-the-union-sotu-address-20230208/" target="_blank" rel="follow" data-article-link="true">US President Biden speaking - State of the Union (SOTU) address</a></li></ul> This article was written by Eamonn Sheridan at www.forexlive.com.

  • Morgan Stanley with 3 reasons the S&P500 bear market is not over
    by Eamonn Sheridan on February 8, 2023 at 10:28 pm

    <p>Via Morgan Stanley's Wealth Management unit, their outlook for US equities.</p><p>Analysts there argue that the recent equity gains are not the start of a long-term bull market; rather, they are just another bear market bounce. The present surge appears to be supported by loosening financial conditions rather than strengthening economic fundamentals. MS project these will turn around later this year.</p><p>MS outline incongruities:</p><p>1. Even as stocks trade higher, recent market action for other asset classes paints a starkly different picture. US government bonds: Treasury yield curves remain deeply inverted, a time-tested signal that an economic downturn is on the horizon.</p><p>2. Since the October low for the S&P 500, Gold continues to outperform both the S&P 500 and the Nasdaq. </p><p>3. If equity investors are expecting a ‘soft landing’ and potential rebound in economic growth later in 2023, oil prices do not reflect that.</p> This article was written by Eamonn Sheridan at www.forexlive.com.

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