Forex news from the European trading session - 29 November 2021
Headlines:
- ECB's de Cos: Inflation rise can be expected to be transitory
- Saudi energy minister confirms delay to OPEC+ meetings this week
- Moderna CEO says data on vaccine efficacy of Omicron variant could be known in 2-6 weeks
- Saxony November CPI +5.0% vs +4.5% y/y prior
- Eurozone November final consumer confidence -6.8 vs -6.8 prelim
- UK October mortgage approvals 67.2k vs 71.3k expected
- SNB total sight deposits w.e. 26 November CHF 719.4 bn vs CHF 719.3 bn prior
- ECB's de Guindos: Factors behind inflation are of transitory nature
- Six cases of Omicron variant reportedly identified in Scotland
- Spain November preliminary CPI +5.6% vs +5.6% y/y expected
- ECB's Schnabel: We think that inflation peak has been reached in November
- WHO assesses overall global risk related to Omicron variant as "very high"
- Russia says OPEC+ partners did not call to review the current deal
Markets:
- AUD leads, EUR lags on the day
- European equities higher; S&P 500 futures up 0.7%
- US 10-year yields up 6.2 bps to 1.546%
- Gold up 0.1% to $1,792.81
- WTI up 5.2% to $71.67
- Bitcoin up 5.6% to $57,012
After the bloodbath of Friday, risk trades are faring better to start the new week as they trim some of the sharp moves at the end of last week.
Trading conditions on Friday were perhaps not helped by the Thanksgiving holiday, thus exaggerating some of the market moves but in any case, the bounce today is proving to be a shallow one so far; all things considered. Dead cat bounce?
European indices are up nearly 1% after the worst drop in 17 months on Friday while US futures are also faring better and gradually pushing higher on the session.
The rebound in bond yields is also helping the mood a little, with 10-year Treasury yields up over 6 bps to just above 1.54% on the day.
All of that still doesn't take away the drop on Friday - not even close - but at least the market is breathing a little easier for the time being.
In FX, EUR/USD is retracing a little of the jump at the end of last week, down 0.3% to 1.1280-90 with the low earlier touching 1.1260. USD/JPY is a little higher, trading up around 113.40-60 in European morning trade on higher bond yields.
The dollar in general is mixed as it is marked lower against the loonie and aussie, though maintaining a slight advance against the kiwi so far.
USD/CAD is pushed lower as oil prices are also bouncing back a little with the pair hovering around 1.2730-40 levels for the most part during the session.
Meanwhile, AUD/USD kept a decent advance around 0.7140-50 levels as buyers keep a defense of the August low @ 0.7106.
Elsewhere, gold is tepid as price is looking a fair bit more sticky just below the $1,800 mark while oil is up over 5% to $71.67 on the day, trading back above its 200-day moving average, though pales in comparison to the 13% plunge on Friday.
