Global Markets:
- Asian stock markets: Nikkei (-5.30 %), ASX 200 (-2.80 %), Shanghai Composite and Hang Seng closed for holiday
- Commodities: Gold at $1193 (-0.40 %), Silver at $15.37 (-0.40 %), WTI Oil at $30.09 (+1.30 %), Brent Oil at $33.05 (+0.55 %)
- Rates: US 10 year yield at 1.69, UK 10 year yield at 1.42, German 10 year yield at 0.22
News & Data:
- Australia ANZ Roy Morgan Weekly Consumer Confidence Index (W/E 7 Feb): 111.4 (prev 111.2)
- Japan Money Stock M2 (YoY) Jan: 3.2% (exp 3.1% prev 3.0%)
- Japan Money Stock M3 (YoY) Jan: 2.5% (exp 2.5% prev 2.5%)
- UK BRC Sales Like-For-Like (YoY) Jan: 2.6% (exp 0.3% prev 0.1%)
- Australia NAB Business Conditions (Jan): 6 (prev rev 6)
- Australia NAB Business Confidence (Jan): 2 (prev rev 2)
- Stocks dumped for safe havens as bank fears flare – RTRS
- Dollar falls under 115 yen to lowest level since Nov 2014 – RTRS
- Growth worries, rate hike uncertainty pull Wall Street down – RTRS
Markets Update:
It's risk-off once again with equities tumbling and USD/JPY falling to the lowest price since November 2014. The sell-off began yesterday as the pair tumbled from 117.45 to a low of 115.20. It eventually finished the trading day around 115.80, but got under renewed pressure as Tokyo opened and heavy selling pushed it to a fresh low of 114.21.
The Euro is benefiting from the risk aversion in global markets and rose to a high of 1.1237, just 6 pips shy of last week's high. Should it take out the 1.1243 level, a test of 1.15 seems likely.
GBP/USD declined almost 200 pips yesterday, but was quiet in Asia and consolidated in a 1.4415-40 range. GBP also suffered from the cross flows as EUR/GBP rallied from 0.7660 to 0.7780 yesterday. Should 0.78 be taken out, there is not much resistance until 0.80.
Price action in the commodity currencies was surprisingly calm compared to the volatility in other major pairs. AUD/USD fell from 0.7070 to 0.7020 in Asia, while NZD/USD declined from 0.6620 to 0.6575. The key support levels to watch are now 0.70 in AUD/USD and 0.6550 in NZD/USD.
Upcoming Events:
- 06:45 GMT – Swiss Unemployment Rate
- 07:00 GMT – German Trade Balance
- 07:00 GMT – German Industrial Production
- 09:30 GMT – UK Trade Balance
- 15:00 GMT – US JOLTs Job Openings
- 15:00 GMT – US Wholesale Inventories
- 21:35 GMT – US API Weekly Crude Oil Stock
