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Bob Mason

Earlier in the Day:

Economic data released through the Asian session this morning was limited to August household confidence figures out of Japan.

For the Japanese Yen, household confidence eased from 43.5 to 43.3 in August, falling below a forecasted 43.4.

According to figures released by the Cabinet Office:

  • The sub-index for overall livelihood rose by 0.1 to 41.7.
  • The sub-index for income growth fell by 0.4 to 41.8.
  • The sub-index for employment fell by 0.3 to 47.7.
  • The sub-index for willingness to buy durable goods fell by 0.2 to 42.0.

The Japanese Yen moved from ¥111.231 to ¥111.204 against the Dollar upon release of the figures before rising to ¥111.18, down 0.01% for the session.

Elsewhere, the Aussie Dollar and Kiwi Dollar were back in the red, the Aussie Dollar down 0.12% to $0.7329, weighed by a continued pullback in metal prices, copper down 0.22% at the time of writing, while the Kiwi Dollar was down 0.07% to $0.6704.

In the equity markets, it was another mixed bag, with the CSI300 down 0.49% at the time of writing, while the Nikkei, Hang Seng and ASX200 enjoyed another positive start to the day, investors not only responding to the fresh record gains in the U.S equity markets on Tuesday off the back of improved sentiment towards trade, but also the upside in the U.S futures markets in the early part of the day.

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The Day Ahead:

For the EUR, after a relatively quiet start to the week, economic data out of the Eurozone is on the heavier side, with key stats including French and German consumer confidence figures, together with 2nd estimate GDP numbers out of France for the 2nd quarter.

Barring any deviation from 1st estimate GDP numbers, German consumer confidence will likely be the key driver for the EUR this morning, which is forecasted to hold steady for September.

At the time of writing, the EUR was down 0.10% to $1.1680, with today’s stats the key driver through the day, though there is always the threat of Oval Office influence through the day.

For the Pound, there are no material stats scheduled for release this morning, which continues to leave the Pound in the hands of the UK government and the Brexit negotiators looking to avoid a no-deal departure from the EU.

While the deadline for negotiations to end is 18th October, news hitting the wires overnight point to a mid-November conclusion, the deadline edging ever closer to the March departure date, which leaves very little room for either side to manouever, raising the prospects of a no-deal scenario.

At the time of writing, the Pound was down 0.13% to $1.2856, with the continued focus on Brexit expected to influence the Pound.

Across the Pond, economic data scheduled for release this afternoon includes 2nd estimate GDP numbers out of the U.S for the 2nd quarter, together with July pending home sales.

Forecasts are for the 2nd estimate GDP numbers to come in slightly softer than 1st estimate, with the economy expected to grow by 4% year-on-year. For the Dollar, holding on to 4% will be key, anything softer likely to hit the Dollar ahead of July’s pending home sales figures that are also forecasted to be on the softer side.

Outside of the data, noise from the Oval Office will remain a factor, with the U.S and Canada having resumed talks on Tuesday.

At the time of writing, the Dollar Spot Index was up 0.04% to 94.761, with today’s stats and the ever present Oval Office the key drivers through the day.

For the Loonie, it’s another quiet day on the data front, with no material stats scheduled for release, leaving the Loonie in the hands of market sentiment towards trade, with initial meetings having commenced on Tuesday.

At the time of writing, the Loonie was up 0.12% to C$1.2917, with trade chatter the key driver through the day.

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