Global Markets:
- Asian stock markets: Nikkei down 1.15 %, Shanghai Composite gained 0.10 %, Hang Seng and ASX both rose 0.20 %
- Commodities: Gold at $1063.60 (+0.05 %), Silver at $13.71 (+0.10 %), WTI Oil at $36.25 (-0.20 %), Brent Oil at $38.00 (+0.05 %)
- Rates: US 10 year yield at 2.21, UK 10 year yield at 1.87, German 10 year yield at 0.59
News & Data:
- Australia House Price Index (QoQ) Q3: 2.0% (exp 2.0% prev 4.7%)
- Australia House Price Index (YoY) Q3: 10.7% (exp 10.2% prev 9.8%)
- Australia ANZ Roy Morgan Weekly Consumer Confidence Index (W/E 13 Dec): 115.4 (prev 116.3)
- Australian government to cut growth forecasts up to 0.5% in mid-year budget review: AFR via BBG
- BoJ Tankan Survey Inflation Expectations (Q4): – 1 Year: 1.0% – 3 Years: 1.3% – 5 Years: 1.4%
- PBoC Fixes Yuan Reference Rate At 6.4559 (prev 6.4495)
- New Zealand Cuts 2015/16 GDP Growth Forecast To 2.2% From 2.9%
- NZ Ministry sees 2015-16 primary exports rising 5.3%, 2016-17 rising 16%
RBA Meeting Minutes:
- Judged recent economic data had generally been positive when holding rates at 2 %
- Reiterate inflation may afford some scope for further easing if needed
- AUD adjusting to significant declines in commodity prices
- Expects economy to strength gradually as drag from mining investment diminished
- Drag from mining to peak in 2015/16 financial year
- Low rates supporting household demand, home building
Markets Update:
Crude oil prices have recovered after another day of losses. WTI fell to $34.50 yesterday, another fresh 6-year low, but managed to recover to $36.70 into the NY close. In Asia, it consolidated between $36.10 and $36.40. USD/CAD declined slightly as oil recovered and reached a low of 1.3705 in Asia, roughly 75 pips lower from yesterday's high. The outlook remains bullish for the pair, with no significant resistance seen until 1.40.
AUD/USD rallied to 0.7280 overnight, while NZD/USD is struggling with 0.68 resistance once again. Should it be able to clear the aforementioned level, next resistance is seen at 0.6895, which is the October 2015 high. The Aussie Dollar has been lagging behind the Kiwi Dollar for a while now and this intensified after the less dovish than expected RBNZ meeting last week.
USD/JPY recovered in Asia after being under pressure yesterday. It bounced from 120.40 in the late NY session and rose to 120.90 into the Sydney open. The pair eventually extended gains to almost 121.20 ahead of the Tokyo open, but ran out of momentum there.
Looking ahead, the focus today will be on UK and US inflation data.
Upcoming Events:
- 08:00 GMT – Spanish CPI
- 08:15 GMT – Swiss PPI
- 08:30 GMT – Riksbank Rate Decision
- 09:30 GMT – UK CPI
- 10:00 GMT – German ZEW Economic Sentiment
- 10:00 GMT – Euro Zone ZEW Economic Sentiment
- 13:30 GMT – US CPI
- 13:30 GMT – US NY Empire State Manufacturing Index
- 15:00 GMT – US NAHB Housing Market Index
- 16:45 GMT – Bank of Canada Governor Poloz speaks
- 21:45 GMT – New Zealand Current Account
