TRUDEAU SAYS `WE HAVE A LOT OF WORK TO DO'

MNI BRIEF: Canada NDP Will Bring Nonconfidence Motion In Jan.

CANADA NDP SAYS WILL INTRODUCE NONCONFIDENCE MOTION

MNI China Daily Summary: Friday, December 20

MNI: PBOC Net Drains CNY103.5 Bln via OMO Friday

MNI: PBOC Sets Yuan Parity Lower At 7.1901 Fri; -2.13% Y/Y

EZ/UK T-Bill Calendar: Greece to Sell Bills Monday

EZ/UK Bond Supply Calendar: BOE APF Sales Due 6 January

MNI: BELGIUM DEC BNB BUSINESS CONFIDENCE -13.8

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

OPTIONS: Markets Isolate Funding Currencies for NFP Reaction

OPTIONS
  • Markets have isolated funding currencies as carrying the greatest NFP-tied risk into the data today, with options trades adding the most notable vol premium for JPY and CHF relative to all other currencies in G10.
  • This further reinforces the view that today's NFP print will prove critical for rate expectations and could spur the next phase of strength for CHF and JPY - with assumed Fed rate cuts and the subsequent tightening of rate differentials a key driver this year.  
  • Vol markets added an overnight premium of over 13 points for USD/JPY and over 10 points for USD/CHF for options rolling off at today's cut, blowing out the implied break-evens across both pairs. USD/JPY prices a near 150 pip swing on today's data, close to three times the YTD average for a routine session.
  • This raises the focus on the bear trigger and key support at 141.70, with December 2023's low just below at 140.25. That said, rates markets are clearly primed for more significant reaction in case of a hawkish surprise today, meaning 144.64, the 50% retracement for the downleg off the Sep03 high should be considered.
  • NFP Preview here: https://media.marketnews.com/USNFP_Sep2024_Preview_156b327b83.pdf
  • Rates markets set-up here: https://marketnews.com/us-tsys-stir-hawkish-nfp-outcome-poses-greatest-risk-to-market-positioning

 

BulletMarketsForeign Exchange Bullets
BulletMarketsForeign Exchange Bullets

To read the full story

Close

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.