Forex news for NY trading on June 12, 2018
- US stocks end the session mixed. Nasdaq outperforms
- US Sen. McConnell: If Trump reaches a significant agreement, hopes it will be as a treaty
- Germany's Merkel: US has a big account surplus if services are included
- PM Trudeau speaks at Parliament: We are continuing to modernize NAFTA
- US budget statement for May shows a deficit of -$146.8B vs -139.5B expected
- Italy's Savona: A single market needs a single currency
- Report: Fed's Powell to have a press conference after all meetings
- 30 year auction high yield at 3.10%
- The "meaningful vote" passes. Government wins. GBPUSD comes off a bit but holding gains.
- European end the session mixed with modest changes.
- White House advisor Navarro apologizes for "special place in hell" comment
- US Senate Democratic leader Schumer: Very worrisome about Trump deal
- US Senate Majority Leader McConnell supports Trump's N. Korea deal
- Japan's Abe: Meaningful that N. Korea promised complete denuclearization
- White House economic advisor Kevin Hassett: US/Canada need to chill
- UK's Davis: Confident government can secure Brexit agreement favorable to Parliament
- US CPI for May 0.2% vs. 0.2% expected. YoY 2.8% vs. 2.8% expected.
- The NZD is the strongest. The CAD is the weakest as NA traders enter
In other markets at the end of day:
- Spot gold is down $4.80 or -0.37% at $1295.73
- WTI crude oil futures are trading down $.06 or -0.09% at $66.04
- Bitcoin is trading down $216 at $6545 and near the lows for the day.
IN the US stock market today, the markets were mixed
- S&P rose 0.17%
- NASDAQ rose 0.57%
- Dow industrial average fell -0.01%
In the US debt market yields are closing up a little
- 2 year 2.536%, +1.6 basis points
- 5 year 2.809%, +1.3 basis points
- 10 year 2.962%, +1.1 basis points
- 30 year 3.095%, +0.2 basis points
In the Forex market, the USD is ending the day as the strongest, helped by a late day move higher. The AUD is the weakest. However the changes are relatively modest for the day.
You have to give credit to the step made in Singapore today for peace. Pres. Trump met with Kim Jong Un, and although this relationship is at it's infancy, it was a step forward. It is impossible to predict right now, how it will end. Will it once again be in tears. Will it take years, Will it progress at a faster pace. There will be supporters. There will be detractors. However, with level headed negotiations on both parts, the upside can be huge. Time will tell.
The impact of the meeting was honestly not particularly earth shattering. Stocks in Europe ended there day mixed with modest changes. US stocks were the same. Interest rates were steady in the US (mixed in Europe). Gold trading lower by the end of the day (relief), but it was not racing lower.
In the forex market, exchange rates were more influenced by the Brexit amendment votes. They were in support of PM May but not without some concessions. That helped to support the GBP - at least for a while. The GBPUSD moved up to from a NY session low of 1.3348 to a NY session high (near a topside trend line) at 1.3429 (see post here and here). The action was in the GBP pairs.
Later in the day, the dollar in general, got better bid. The catalyst was a report that Fed's Powell was considering having a press conference after each Fed meeting (not just every other one). The implication is that each meeting would be in play and could prod the Fed to tighten quicker (and ease quicker too if needed down the road).
The EURUSD moved from about 1.1785 down to a low for the day around the 200 hour MA at 1.1743.
The USDCAD moved to new session highs, the NZDUSD and the AUDUSD moved to new lows.
That helped the dollar move higher in general, but overall the gains were modest.
On a economic data perspective today, the only US release was CPI for May. The YoY moved to the highest level since January 2012 at 2.8% which was as expected. The MoM rose by 0.2% also as expected. For the core ex food and energy the YoY came in lower at 2.2% (as expected). The "as expected" data had limited impact on forex rates.
So give credit to Pres Trump for taking the first step for peace today - even if the impact was limited.
Give market moving credit to the Brexit amendment votes, and a report that Fed may have more press conferences.
What next?
All eyes will be on UK CPI, US PPI and the FOMC decision in the new day. Will it ignite more price action for traders? Time will tell.
