USD moderately higher, defies negative seasonal trend – Scotiabank
The US Dollar (USD) is tracking a little higher overall this morning, lifting the DXY to the mid-106 area and potentially setting up trading today for a little more strength— despite usually negative seasonal trends for the dollar broadly in December. It’s a busy day for central bank speakers, Scotiabank’s Chief FX Strategist Shaun Osborne notes.
USD edges marginally higher
“The KRW has, however rebounded strongly following yesterday’s fleeting “martial law” announcement by the president. The AUD and the JPY are the leading losers among the majors, falling 1.1% and 0.8% in the session respectively. Australian GDP was weaker than forecast, rising 0.3% in Q3 (versus 0.5% expected). Short rates rallied in response, but a full quarter point cut remains unlikely before March, according to swaps pricing.”
“The JPY’s losses were driven by an MNI report suggesting that local political concerns were prompting BoJ officials to err on the side of cautious policy normalization. December swaps pricing eased from reflecting 15bps of tightening to less than 8bps. After yesterday’s stronger-than-expected US JOLTS data, attention turns to the ADP jobs report this morning. Private sector jobs are expected to rise 150k in November.”
“It’s a busy day for central bank speakers as well. The Fed’s Musalem (non-voter), Barkin, Daly and Chair Powell are speaking over the course of the day. The Fed also releases what may be a cautious-sounding Beige Book at 14ET. Some ECB policymakers are also on the calendar, including President Lagarde. BoJ Board member Nakamura (generally viewed as a relative policy dove) is speaking this evening (20.30ET).”
Recommended Articles
