Forex news for New York trade on October 28, 2019:
- UK PM Johnson to EU Tusk: "I confirm the extension"
- Boris Johnson says government will give notice of a short bill for Dec 12 election
- BOE Tenreyro: Exchange rates continue to have important effects on export volumes
- October Dallas Fed manufacturing index -5.1 vs +1.0 expected
- Fmr NY Fed President Dudley sees cut this week; leaves out politics this time
- US Sept advance goods trade deficit $70.4B vs $73.5B expected
- US wholesale inventories for September (P) -0.3% versus 0.3% estimate
- Sept Chicago Fed national activity index -0.45 vs +0.05 expected
Markets:
- Gold down $13 to $1492
- WTI crude down 86-cents to $55.79
- S&P 500 hits all time record, closes up 17 points to 3039
- US 10-year yields up 5 bps to 1.84%
- GBP leads, JPY lags
Stock markets are in charge today as earnings season rolls on. So far commentary has been better than feared and few CEOs are ringing alarm bells about a recession. That propelled the S&P 500 and Nasdaq to all-time highs while dragging USD/JPY to the highest since July 31.
On the flipside, gold was sold as the market gets increasingly comfortable with the idea that the mid-cycle adjustment at the Fed will pause after Wednesday's meeting. It fell $12 to erase much of last week's gains.
Cable made some headway early in Europe then chopped sideways near the highs in New York. An election is beginning to look inevitable but everyone is fighting over the details. Last at 1.2862.
EUR/USD sagged on Friday but recouped half the fall today in a 20-point rally to 1.1100. Draghi's speech was a non-event as his retirement tour continues.
In commodity FX, it was the Australian dollar outperforming as trade and recession fears ebb. USD/CAD finished near the lows of the day but failed in a few attempts to definitively break 1.3050.
In the bigger picture, the market is waiting on the Fed Wednesday along with some top-tier economic data due in the second half of the week.
