Kantox currency update: dollar, higher in a risk-on session
The dollar appreciated against its main peers on Wednesday, with the euro and the yen pulling lower in a context of increasing risk appetite, as investors’ gain confidence on the benefits of the fiscal reform proposed by Trump’s administration.
The pound sterling remains vulnerable on the back of the erratic course of the Brexit negotiations, with the market increasingly concerned about an unfriendly divorce, which would have an enormous impact on UK economy.
EUR/USD dives below 1.1800. The euro depreciated against the dollar in a risk-on session, extending its pullback from last week highs above 1.1900 to session lows right below 1.1800. At London market opening times, the EUR/USD is trading at 1.1795.
GBP/USD: extends reversal below 1.3400. The pound is giving away last week’s gains after topping at 1.3548, as the pair dropped for the second consecutive day on Wednesday, returning to the mid-range of 1.3300. At London market opening times, the GBP/USD is trading at 1.3370.
USD/JPY support at 112.00. The U.S Dollar remains trading within a 100 pips range, capped below 113.00, with downside attempts contained above 112.00. At London market opening times, the USD/JPY is trading at 112.55.
In the Calendar Today
At 10:00 GMT Eurostat will release the final reading of Eurozone Q3 Gross Domestic Product data, on Thursday. According to preliminary estimations, Eurozone economy grew at a 2.5% annual pace in the quarter. Revisions to that reading might have some impact on the euro
At 16:00 GMT investors will be attentive to ECB president Mario Draghi’s speech. His comments about inflation, the Eurozone economic outlook and especially the bank´s plan to remove the monetary stimulus might move the euro.
At 23:50 GMT the Cabinet Office will release the final reading of the Japanese Q3 Gross Domestic Product. Previous estimations point out to a 1.4% yearly advance (after the 2.5%growth on the previous quarter). Revisions to those figures might have some impact on the yen.
10:00 GMT EZ: Gross Domestic Product (YoY) (Q3)
Prev: 2.5% Cons: 2.5%
16:00 GMT ECB: Mario Draghi’s speech
23:50 GMT JP: Gross Domestic Product Annualized (YoY) (Q3)
Prev: 1.4% Cons: 1.5%