Forex news for New York trade on March 6, 2019:
- Bank of Canada leaves interest rates unchanged at 1.75%, as expected
- The Bank of Canada March 2019 rate statement
- US trade balance for December -$59.8B vs -$57.9B estimate
- US February ADP employment +183K vs +190K expected
- ECB said to cut outlook by enough to warrant new loans (TLTROs)
- Canada December international merchandise trade balance -4.59B vs -2.8B expected
- Cox presented two ideas to Barnier that were shot down
- Fed's Williams: If strong economy continues but inflation trends down, we might need lower rates
- Williams: Base case looking good but uncertainties loom
- Beige Book: 10 of 12 districts saw slight-to-moderate growth
- Weekly US EIA crude oil inventories +7069K vs +1450K expected
- May spokesman: Talks in Brussels were difficult but are ongoing
Markets:
- Gold down $1.50 to $1286
- WTI down 36-cents to $56.20
- US 10-year yields down 2.35 bps to 2.69%
- S&P 500 down 18 points to 2771
- JPY leads, AUD lags
The Canadian dollar was the big mover in FX today as the BOC dropped an explicit mention of tightening and replaced it with something more vague. Most BOC-watchers had expected them to wait until April to make a move and USD/CAD jumped 70 pips on the move. The upside was helped by dismal Canadian trade numbers.
The US dollar was conversely hurt by a record 2018 trade deficit and took little relief in a big upward revision in the ADP report. USD/JPTY sank to 111.60 from 111.85 at the start of New York trade but it later recovered most of the loss despite falling stocks and yields.
The ECB will be the big story in the day ahead. Some fixing demand helped the euro to 1.1330 but it faded back to 1.1310 afterwards. An ECB leak suggested lower forecasts and impending TLTROs.
Cable had its narrowest range in three weeks as it consolidated around 1.3150 in advance of the big vote next week. Signs were that May wasn't making any progress with the EU.
AUD/USD broke down on GDP in Asia-Pacific trade and never recovered. It hit a marginal new low since January and finished at 0.7025.
