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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FOREX
- Moves on the front end of the Euro curve have been very aggressive this week (especially in the past two days) as reflation trades continue.
- Euro 2Y swap rate surged to 15bps today, its highest level since August 2015, up from -50bps in early September and up from -20bps last week.
- The significant rise in the 2Y swap rate has been driving the Euro higher against the greenback.
- The chart below shows the relationship between the EURUSD exchange rate and the 2Y swap rate differential in recent months.
- EURUSD broke above its 100DMA today and nearly tested its 1.1493 resistance, which corresponds to the 50% retracement of the 1.0640 – 1.2350 range; a break above that level would open the for a move up to 1.16 (Sep 21 highs).
- The strong NFP print today coming in at 467K, nearly four times more than the 125K expected, led to a positive bounce on the greenback.
- However, further consolidation on the front end of the Euro curve could continue to support EURUSD in the near term.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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