Markets quiet with focus on vaccine news
The US dollar is largely unchanged overnight as global bond yields edged lower and global equities moved slightly higher. Investors continue to focus on recent upbeat vaccine news. Pfizer’s claims that their vaccine is 95% effective with no big safety issues may position it well for US regulatory approval before long. The UK pound is higher for the fourth straight day on hopes of a Brexit deal shortly. This morning’s release of US Housing Starts for October exceeded expectations and reached its highest level since February.
November 18, 2020
EUR/USD 1.1871 GBP/USD 1.3291 USD/CAD 1.3087 AUD/USD 0.7309 USD/JPY 103.8900 USD/CNH 6.5608 USD/ILS 3.3477 USD/MXN 20.2298 USD/CHF 0.9109 USD/INR 74.1925
The dollar moved in a narrow range overnight. The dollar index sits fairly close to yesterday’s NY close, and remains near two-year lows. The New Zealand dollar showed the biggest move vs. the USD, strengthening by only 0.33%. The dollar did move off earlier lows following upbeat US Housing Starts.GBP
The UK pound rallied for the fourth day, as hopes grow of a Brexit deal as early as next week. Inflation came in higher than expected: October CPI rose 0.7% YoY vs. expectations of 0.5%, and the Retail Price Index rose 1.3% vs. 1.2% YoY.EUR
The euro changed little overnight, but remains within striking distance of key $1.19 resistance. There are no expected events in Europe this week that would trigger a move above that level. Eurozone CPI for October came in exactly as expected, +0.2% MoM and -0.3% YoY.CAD
The Canadian dollar changed little overnight, despite higher inflation data: October CPI was 0.7% vs. expectations of 0.4%. Bank of Canada’s Senior Deputy Governor Carolyn Wilkins speaks today.ASIA/PACIFIC
Japan’s Nikkei 225 stock market index fell by over 1% following reports of a record number of new Covid-19 cases in Japan.
After early strength, the Chinese yuan sold off as traders began to focus on technical signals that the rally in the CNY was overdone. China’s currency has gained 8.5% over the past six months, the most in Asia after the South Korean won.
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