Free Trial
NZD

Narrow Ranges In The Asian Session

AUSTRALIA DATA

Australia Dec Housing New Loan Commitments -4.3%

CHINA RATES

China Repo Rates Diverge On Friday

CNH

CNY Fixing: Still Modestly Firmer

Real-time Actionable Insight

Get the latest on Central Bank Policy and FX & FI Markets to help inform both your strategic and tactical decision-making.

Free Access

China's COVID-19 Situation Weighs On Risk, Greenback Slips Ahead Of U.S. CPI

FOREX

Risk sentiment soured as a worsening COVID-19 outbreak in China's manufacturing hub of Guangzhou resulted in tighter curbs across the country, dampening hopes for a sooner re-opening. Against this backdrop, participants were wary of taking more risk ahead of the release of U.S. CPI data, today's key risk event.

  • Fed's Kashkari said that the Fed would do what's needed to bring inflation under control but "monetary policy acts with a lag." Today's CPI data has the potential to move the needle on Fed outlook, with analysts in a Bloomberg survey expecting headline consumer inflation to have eased to +7.9% Y/Y in October from +8.2% prior.
  • The BBDXY index ground lower, giving back some of yesterday's gains. The index has now shed 0.35% from the previous day's peak and is testing session lows at typing, with U.S. Tsy yields sitting slightly lower across the curve.
  • The Antipodeans went offered amid cautious mood even as USD/CNH retreated on the back of broader dollar weakness. RBA Dep Gov Bullock said that interest rates need to go up a "little bit" further but are close to the level where the Board could take time to evaluate the impact.
  • USD/JPY faltered thanks to lower U.S. Tsy yields, with the latest set of comments from BoJ Gov Kuroda offering little new. The official underscored the need for continued deployment of ultra-loose monetary policy, adding that one-sided, rapid yen decline has paused for now.
  • Sterling outperformed in G10 FX space, with the cable returning above the $1.1400 mark. The broader European FX bloc was generally firmer, with SEK lagging regional peers.
  • Apart from U.S. inflation figures, today's data highlights include U.S. jobless claims & Norwegian CPI. There is plenty of central bank inbound, from Fed, ECB & BoE officials.
286 words

To read the full story

Why Subscribe to

MarketNews.com

MNI is the leading provider

of news and intelligence specifically for the Global Foreign Exchange and Fixed Income Markets, providing timely, relevant, and critical insight for market professionals and those who want to make informed investment decisions. We offer not simply news, but news analysis, linking breaking news to the effects on capital markets. Our exclusive information and intelligence moves markets.

Our credibility

for delivering mission-critical information has been built over three decades. The quality and experience of MNI's team of analysts and reporters across America, Asia and Europe truly sets us apart. Our Markets team includes former fixed-income specialists, currency traders, economists and strategists, who are able to combine expertise on macro economics, financial markets, and political risk to give a comprehensive and holistic insight on global markets.

Risk sentiment soured as a worsening COVID-19 outbreak in China's manufacturing hub of Guangzhou resulted in tighter curbs across the country, dampening hopes for a sooner re-opening. Against this backdrop, participants were wary of taking more risk ahead of the release of U.S. CPI data, today's key risk event.

  • Fed's Kashkari said that the Fed would do what's needed to bring inflation under control but "monetary policy acts with a lag." Today's CPI data has the potential to move the needle on Fed outlook, with analysts in a Bloomberg survey expecting headline consumer inflation to have eased to +7.9% Y/Y in October from +8.2% prior.
  • The BBDXY index ground lower, giving back some of yesterday's gains. The index has now shed 0.35% from the previous day's peak and is testing session lows at typing, with U.S. Tsy yields sitting slightly lower across the curve.
  • The Antipodeans went offered amid cautious mood even as USD/CNH retreated on the back of broader dollar weakness. RBA Dep Gov Bullock said that interest rates need to go up a "little bit" further but are close to the level where the Board could take time to evaluate the impact.
  • USD/JPY faltered thanks to lower U.S. Tsy yields, with the latest set of comments from BoJ Gov Kuroda offering little new. The official underscored the need for continued deployment of ultra-loose monetary policy, adding that one-sided, rapid yen decline has paused for now.
  • Sterling outperformed in G10 FX space, with the cable returning above the $1.1400 mark. The broader European FX bloc was generally firmer, with SEK lagging regional peers.
  • Apart from U.S. inflation figures, today's data highlights include U.S. jobless claims & Norwegian CPI. There is plenty of central bank inbound, from Fed, ECB & BoE officials.