Forex news for Asia-Pacific trade on December 9, 2020:
- Von Der Leyen: We remain far apart
- Brexit report: Senior UK source says very large gaps remain
- US covid-19 death toll was a record 3112 Wednesday
- Brazil central bank holds rates at 2.00%, says believes inflation is temporary
- PBOC sets yuan midpoint at 6.5476 vs 6.5450 at yesterday's close
- Australia December consumer inflation expectations +3.5% vs +3.5% prior
- US monthly poll: GDP to grow 4.0% in Q4 vs 3.7% in Nov poll
- UK RICS Nov house price balance +66 vs +60 expected
- Japan BSI Q4 business conditions all industry +11.6 vs +2.0 prior
- Japan November PPI 0.0% m/m vs 0.0% expected
- New Zealand November card spending +0.1% vs +7.5% prior
- US House passes one-week stopgap funding bill, sends it to Senate
Markets:
- Gold flat at $1839
- US 10-year yield down 1 bps to 0.93%
- Nikkei flat after opening down 1%
- AUD leads, GBP lags
Coming into the trading session the mood had turned negative because of a tech-led equity market selloff in the United States. With that Japanese equity futures were down 1% and commodity currencies were skidding on the lows.
Then news hit that the meeting between Johnson and Von der Leyen hadn't led to any kind of breakthrough and that 'sides were far apart' and it looked to be a tipping point. GBP/USD quickly fell to 1.3320 from 1.3405.
However the mood stabilized relatively quickly and then bounced back. Cable recouped most of the gains with a bit of help from a soft dollar.
More broadly, the non-stop rally in metals continued and the mood improved. Japanese equities are now flat and the commodity currencies have rallied about 0.3%.
Some of that is a result of the build up in positive economic data, including a few more points today. It's tough to argue against it all, even if it feels bizarre at the height of the global pandemic. It turns out a deadly virus is no match for low rates and high spending.
