2019-11-11 • Updated
In the absence of the news catalysts over the weekend, the market moves were subdued in Asia today. In the early hours of the session, the focus was on the Bank of Japan's summary of opinion - the info from the last bank's meeting. It did the i's and crossed the t's and made clear that policymakers have no thoughts of tapering any time soon. Despite upbeat growth data, inflation is still far below the target. So, there is still lots of bond purchases going forward. USD/JPY ticked a little bit higher to 111.30 in the Asian session. There is a scope for a further surge towards 111.80. A failed test of this level may result in a rollback towards 111.00, 110.90.
USD/CAD rose to 1.3260. The Loonie still needs time to recover from Friday's losses. It weakened significantly at the end of the past week following the extremely poor Canadian CPI. The headline fell to 1.3% from 1.5% and in doing called a halt to the discussion of an imminent rate hike. It seems that the US dollar still has some strength to test the resistance of 1.3340. If the Loonie takes its heart again we will be waiting for its return to 1.3250/1.3210 levels.
EUR/USD slipped a few points today and reached 1.1190. German Ifo Business Climate is about to come out at 12:00 GMT+3. An upbeat headline indicating Germany's economic health will push the euro higher towards the nearest resistance at 1.1205 or even higher. A missing print would trigger EUR selling - EUR/USD falling towards the supports at 1.1175/1.1165.
Much more interesting than the economic data this week/today will be the number of central banks' head on the speaking roster. The ECB President Mario Draghi and former Fed's Chair Bernanke are set to kick off Sinatra's proceedings with the speeches later this day. In the upcoming three days there will a panel on Wednesday featuring Mark Carney, Mario Draghi, Haruhiko Kuroda and Stephen Poloz. Janet Yellen will be speaking on Wednesday.
The British pound increased to 1.2742 in the Asian session. Aussie also made some gains today against USD. It rose to 0.7575 from 0.7600/0.7625. Brent oil futures jumped above $46.20 after having fallen for almost 5 weeks in a row on concerns OPEC-led production cuts may fail to ease a global glut.
China has issued new oil product export quotas to allow oil companies to send surplus barrels overseas, particularly Sinopec, which has the highest volume among quota holders. While the exact quota volume remains undisclosed, oil companies are forecasted to export approximately 3.5 million metric tons of clean oil products in September, a 10% increase from August.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Oil prices rebounded slightly on Friday but are still expected to show losses for the week due to concerns about slowing growth in the US and China. US crude futures rose 2.7% to $70.41 per barrel, while the Brent contract increased by 2.5% to $74.33 per barrel.
The past several weeks have been a real triumph for the bulls in the oil market. The Brent spot price grew by 8.5% during the last month.
Gold prices are rising for three consecutive days ahead of the Federal Reserve (Fed) interest rate decision, which is expected to remain unchanged due to declining inflation and a positive economic outlook. Investors are keen on the Fed's interest rate guidance, fearing a hawkish stance that could trigger market risk aversion.
Amid concerns of a Chinese economic slowdown, reports of declining investment often overlook China's efficient investment strategy in emerging sectors for long-term growth. China has taken measures to stabilize foreign and private sector investments, like reducing the reserve requirement ratio to boost investor confidence.
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