Forex news for New York trading on January 23, 2017:
- Trump signs executive orders to quit TPP and freeze Federal hiring
- White House: The border wall is a serious priority
- Mexican President: We should redefine relationship with US
- Fed's Lacker: 'We're at risk of getting behind the curve'
- Eurozone January advance consumer confidence -4.9 vs -4.8 expected
- ECB QE count: Bought €18.527bn vs €18.903bn prior
- Germany to leave official 2017 GDP forecast at 1.4% - Reuters
- ECB's Praet: Monetary policy cannot deal with Asymetric shock
- Canada November wholesale trade sales +0.2% vs +0.5% expected
- US refiner Phillips 66 says it was awarded oil from the US strategic petroleum reserve
- ECB's Linde: EU leaders must answer for project
Markets:
- Gold up $5 to $1215
- WTI crude oil down 41-cents to $52.81
- S&P 500 down 5 points to 2266
- US 10-year yields down 6.8 bps to 2.39%
- JPY leads, USD lags
The market was more lively than the newsflow today. The only headline that moved this was Trump saying he wanted a massive corporate tax cut but that was 15 pip kneejerk that quickly faded.
The overall theme was gradual US dollar weakness. Cable is a good example as it started US trading at 1.2450 and slowly climbed to 1.2510. We watched for stops as it broke through the figure but it was the same slow grind. The 100-dma is the next line in the sand.
USD/JPY started at 113.40 but caught a quick bid up to 114.00, partly on the tax talk but the move unwound in an hour and it was off to session lows all the way down to 112.76. The low last week was 112.57 and that's the next spot to watch.
The euro had a tougher time despite the broad weakness. Offers at 1.0750/55 have held the pair below around the globe. Even as dollar selling intensified more broadly, that pair could break out. On the crosses, that sent EUR/JPY down after three straight days of gains.
USD/CAD started out nearly flat as USD weakness and oil weakness played to a stalemate but crude cut its losses midway through trading and that sent the pair down below 1.3265 and some minor stops to 1.3231. More-recently, it's recovered that move but is still on track to finish 50 pips lower on the day.
The Australian dollar hit a session high before the London fix but some fixing sales sent the pair from 0.7587 down to 0.7570 and it continued down to 0.7550.
