Risk-on market sentiment supports commodity linked currencies
Cate Camerota " | December 2, 2019
Data from China unexpectedly showed a rise in manufacturing PMI supporting commodity linked currencies - USD is lower as a result. Polling data out of the UK shows that the Conservative Party is leading by a small margin. The demand for protection against a drop in Sterling has increased.
December 2, 2019
EUR/USD 1.1039 GBP/USD 1.2939 USD/CAD 1.3302 AUD/USD 0.6799 USD/JPY 109.59 USD/CNH 7.0386 USD/ILS 3.4681 USD/MXN 19.549 USD/CHF 0.9963 USD/INR 71.6040
The dollar is trading lower than commodity-linked currencies on data released out of China showing a surprise uptick in the official manufacturing PMI. This week the House begins to decide on whether or not to bring impeachment articles against President Donald Trump.GBP
Sterling was down as much at 0.2% at 1.2900 following polls that showed the Conservative Party is narrowly leading the Labour Party. Demand for protection against a weaker GBP has increased following these poll results. Implied volatility is trading at highest levels since the Brexit referendum in 2016.EUR
The euro remains largely unchanged remaining within its tight trading range. Despite data showing that eurozone factory activity strengthened to a three-month high last month, the EUR failed to move beyond its trading range.CAD
USD/CAD remains above 1.3250 trading close to the 1.3300 level. The Canadian dollar remains weak heading into Wednesday’s Bank of Canada’s rate decision. Investors are losing confidence in the strength of the Canadian economy.ASIA/PACIFIC
In reaction to the market’s risk-on sentiment, USD/JPY rises to 109.73 - its highest level since May 30.
NZD led gains for G10 currencies following reports that stated the government will increase spending. Details and size of the spending package will be outlined on December 11. NZD/USD traded near a one-month high up to 0.6462.