Collinson FX Market Commentary - Jan 20 - Markets steady in transition

by Collinson FX on 20 Jan 2017 Collinson FX Market Commentary - Jan 20 - Markets steady in transition

Jan 20 - Markets were steady ahead of the all important US inauguration for Trump tonight. The ECB left rates unchanged, in a dovish statement from ECB President Draghi, who observed no upward trend in inflation. By contrast, the Fed President was hawkish, commenting that goals of growth and employment were close to being satisfied, enabling interest rises in the current year.

This supported the Dollar, with the EUR sliding to 1.0620, while the Yen moved back to 115.50. US economic data continued to reflect an improving economy, with Housing Starts jumping 11.3%, while the Philly Fed survey showing continued improvement in the Manufacturing sector. The Dollar rise did little to deter commodity currencies, as the NZD held 0.7125, supported by stronger Consumer Confidence.

The AUD held 0.7525, despite Unemployment rising slightly, nullified by a rise in the participation rates. All eyes are on Washington and the peaceful transition of power, while analysts look to the coming possible avalanche of executive actions, impacting markets from day one

Collinson FX Market Commentary - Jan 19 - UKP surges on Brexit news

Jan 19 - On the eve of inauguration, markets were steady, while the Dollar rebounded. Consideration of proposed Trump policies are reaching a crescendo but reality will soon hit home.

UK PM May quelled many critics with her outline of Brexit and provided some plan for the future. Her vision of the return to a global power in trade was appreciated by markets, with the GBP surging to 1.2300, while overnight employment data remained strong.

All eyes remained focused on the US Inauguration, with a mild recovery of the reserve pushing commodity prices lower, impacting the associated currencies. The AUD maintained 0.7500, while the NZD drifted back towards 0.7150, shy of the important technical level of 0.7200.

The Trump administration is nigh and all indications are for a strong fiscal and economic strategy that should strike strong rallies in the currency and the US economy.

Collinson FX Market Commentary - Jan 18 - Brits opt for Free Trade

Globalist forces rallied in Davos, with business leaders welcoming a new leader, China! It is the height of irony that the supposed bastion of global capitalism is being lead by the Chinese communists!? President Xi advocated globalisation and free trade, which was embraced by the elite globalist billionaires/multinationals.

The problem is that it works well for China and multinationals but not so good for traditional manufacturers. Free trade is not so free, as access to Chinese markets for exports is limited and capital flows, are severely restricted. The big news overnight was a speech from UK PM May. She outlined a clean break for the UK and proposed free trade and a close relationship with the EU.

Her vision was returning the UK to the role of a global trading leader and this has been welcomed by the US, Australia and New Zealand. The Dollar continued to drift, as the GBP surged to 1.2400, while the EUR pushed towards 1.0700. Commodity currencies continued to prosper the slide in the reserve, with the AUD trading 0.7540, while the NZD moves towards the important technical level of 0.7200. The inauguration on Friday is the market focus and the new administrations moves to reverse executive orders and lay out policy will be important.

Collinson FX Market Commentary - Jan 17 - Hard line on Brexit from May

Markets were nervous overnight, with the UK PM May scheduled to make a speech addressing 'Brexit', with expectations of a tough position. A hard brexit may suggest complex negotiations with Europe, in terms of trade and access to financial and services markets, pushing the GBP to new lows.

Apparently the compensatory agreements with the commonwealth countries and the US, highlighted by the recent visit of NZ PM English, were not enough! The GBP fell to 1.2060, despite weakness in the Dollar, while the EUR held 1.0600. The Trump inauguration, on Friday, has also been the major consideration of markets this week.

Doubts have surfaced about global trade and predatory industry/corporate tactics driving nervous speculation. The AUD drifted back to 0.7470, while the NZD held 0.7100, with all currencies being vulnerable to US Dollar swings.

Collinson FX Market Commentary - Jan 16 - Market jitters over Inauguration

Markets were tame going in to the last full week of the Obama administration with speculation rife. The University of Michigan Economic Sentiment reported the status quo after some major gains post the US election.

Markets remain in a flux ahead of this week's US Inauguration with high expectations and uncertainties. The Dollar settled, with the EUR trading 1.0640, while the Yen held 114.00. NZ Consumer Confidence was flat, lending little to a buoyant currency, which held 0.7100.

Chinese Exports were static, while imports surged 10.8%, supporting trading partners, including the AUD which traded around 0.7500. The coming week will be dominated by the US Inauguration and the speculation associated with it!

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