Global Markets:
- Asian stock markets: Nikkei down 0.50%, Shanghai Composite up 0.31%, Hang Seng up 1.16%, ASX down 0.25%
- Commodities: Gold at $1337.80 (+0.56%), Silver at $16.615 (+0.53%), WTI Oil at $59.20 (+0.02%), Brent Oil at $62.81 (+0.14%)
- Rates: US 10-year yield at 2.817, UK 10-year yield at 1.613, German 10-year yield at 0.739
News & Data:
- (NZD) Inflation Expectations q/q 2.10% vs 2.00% previous
- (GBP) RPI y/y 4.00% vs 4.10% expected
- (GBP) PPI Input m/m 0.70% vs 0.70% expected
- (GBP) CPI y/y 3.00% vs 2.90% expected
- (CHF) PPI m/m 0.30% vs 0.20% expected
- Japan's Chief Cabinet Secretary Suga: Will continue to watch forex moves
- PBOC sets USD/ CNY reference rate at 6.3428 vs. 6.3247 previous
Markets Update:
The upcoming Lunar New Year holiday has put a damper on trading in Asian markets. Not just that, investors were seen exercising caution, in anticipation of the US inflation data, expected later in the day today. In general, the markets were observed to be mixed.
Samsung Electronics pulled up KOSPI, whereas Tencent propped up Hang Seng. The Nikkei was under pressure from a stronger yen. Banks have been weighing in on the ASX.
The JPY was at its strongest in 15 months on Tuesday, at 106.85 against the USD. Its perception as a safe-haven currency, is leading to investors flocking to it, at the time of an increased market volatility. While economic growth has slowed in the fourth quarter, positive takeaways from softer-than-forecast Japanese GDP data highlighted improvement in consumer spending.
NZD outperformed after figures showed a boost in inflation expectations. The Dollar has been under pressure, as analysts expect a drop in headline and core inflation.
The yield on US treasuries have dropped 2bps from 2.83 to 2.81, while regional yields have strengthened. However, JGBs was seen to be lagging behind in comparison. Gold, along with other metals, has made significant gains, primarily due to dollar weakness. Crude was largely unchanged today.
Upcoming Events:
- 07:00 AM GMT – (EUR) German Prelim GDP q/q
- 08:00 AM GMT – (EUR) German Buba President Weidmann Speaks
- 08:50 AM GMT – (CHF) Gov Board Member Zurbrugg Speaks
- 10:00 AM GMT – (EUR) Flash GDP q/q
- 11:20 AM GMT – (CHF) Gov Board Member Zurbrugg Speaks
- 01:30 PM GMT – (USD) CPI m/m
- 01:30 PM GMT – (USD) Core CPI m/m
- 01:30 PM GMT – (USD) Core Retail Sales m/m
- 01:30 PM GMT – (USD) Retail Sales m/m
- 03:30 PM GMT – (USD) Crude Oil Inventories
