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Needle Still Points South


Yields Bounce as Equities Make New Monthly Highs


Heading North


Bull Rally Accelerates


Economists Survey Raises 2021 CPI Forecast To 4.9%

FOREX: Sentiment has improved amid hopes that the spread of Wuhan coronavirus
can be contained (their basis is somewhat questionable as of yet) & its economic
impact mitigated. In addition, China decided to halve additional tariffs on
$75bn worth of U.S. imports from Feb 14. The yuan appreciated in spite of a
higher than exp. fixing of the USD/CNY mid-point from the PBoC.
- Safe haven currencies lost some ground, to the benefit of high-beta FX. The
Aussie outperformed its G10 peers, drawing some support from an above-forecast
quarterly retail sales print, even as the monthly reading missed consensus.
USD/JPY threatens to break above Y110.00, but is yet to test the round figure.
GBP underperformed in the wake of yesterday's BBG report re: EU plans to unwind
concessions to the City of London made in the bloc's financial rulebook.
- Most Asian EMFX firmed up in tandem with risk appetite. KRW led gains in the
space, with USD/KRW falling the most in a month. SGD & THB swam against the
tide, after y'day's dovish comments from the MAS & a rate cut from the BoT.
- Under the microscope today are German factory orders and speeches from Fed's
Kaplan, ECB's Lagarde & her colleague Villeroy.
MNI London Bureau | +44 203-865-3806 |
MNI London Bureau | +44 203-865-3806 |